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U.S. 15-year-olds score average in financial literacy

TAMPA — When it comes to demonstrating knowledge in saving money, balancing a checkbook, investing and other financial skills needed to be successful, 15-year-olds in the United States perform right around average compared to other countries.

According to a report to be released today, more than one in six American 15-year-olds lacks proficiency in financial literacy, meaning they know only the bare minimum when it comes to making financial decisions. About one in 10 American students is considered a top-performer.

The Organization for Economic Cooperation and Development for the first time today will release a report on the financial literacy of 15-year-olds across the globe based on scores from the Program for International Student Assessment in 2012, the last time the test was given.

The report comes as some states, including Florida, move toward a more robust approach to teaching financial literacy in schools. Starting with last year’s ninth-graders, Florida students were required for the first time to receive financial literacy instruction in their economics classes before they graduate.

There was a push in the Legislature this year to add a separate financial literacy course to high-school graduation requirements, but the effort failed.

And last week, the state was the first to adopt a national set of financial literacy standards, which will be included in the already existing social studies standards. The State Board of Education voted to usher in the Council for Economic Education’s K-12 National Standards for Financial Literacy.

The Program for International Student Assessment measures 15-year-old students’ reading, math and science skills. The first tests were administered in 2000 and they are conducted every three years. For the first time in 2012, the test also included general problem-solving and financial literacy portions.

Financial literacy was added to better prepare students to make fiscal decisions in today’s world, helping their families and society as a whole, the Organization for Economic Cooperation and Development said.

“From younger ages, more financial products are accessible to students,” said Michael Davidson, head of the organization’s early childhood education and schools division. “The financial markets are becoming increasingly more complex.”

In 2012, students from 65 countries took the PISA and 18 countries and communities opted to take the financial literacy portion.

The students from the United States, which rank somewhere between eighth and 12th, far outpaced their peers in Colombia, which is ranked last. They lagged behind Shanghai, which is ranked first.

In the United States, 51 percent of the students tested reported they have a bank account and those students performed better than their peers who don’t have bank accounts. In Shanghai, 90 percent of students have bank accounts.

In some places, like the United States, students’ socioeconomic background has a stronger correlation to their financial literacy scores than their math and reading scores.

In Hillsborough County, schools have taught financial literacy for at least 20 years, said district social studies supervisor Dennis Holt.

“For us, it meant no change whatsoever,” he said, referring to last year’s state mandate to teach financial literacy and the new standards. “Financial literacy really is infused everywhere from kindergarten through adult.”

Teachers can choose to work with the local Junior Achievement chapter to teach financial literacy, or they can teach it on their own.

Additionally, each county fifth-grader visits the organization’s BizTown, a miniature “town” where they learn what it’s like to work for a paycheck, deposit money in the bank and run errands. In the eighth grade, professionals with local businesses visit classrooms to speak to students about being financially responsible.

It’s too early to tell if offering programs like these in schools will boost their performance on that portion of the PISA test, Davidson said.

Shanghai — which scored 603 points in comparison to the United States’ 492 points — doesn’t emphasize financial literacy programs, but students there performed exceptionally well in math.

“When we look at the relationship between the ability of financial education and the performance of countries in financial literacy, we see a scattered picture,” Davidson said.

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Twitter: @ErinKTBO

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