Alabama’s high school students will learn a little bit more about personal finance after the state Board of Education approves changes to a required course.

Alabama requires high school students to take a career preparation course at some point in high school. It already has some financial literacy modules, but schools will need to beef up instruction about taxes.

Rep. Andy Whitt, R-Harvest, who told lawmakers that as a community banker for the past 30 years, has seen a decline in people who understand the basics of personal finance. The law was passed in May.

The bill received unanimous approval in both chambers and is effective for students in the ninth grade as of the 2024-25 school year. That’s this year’s eighth graders.

State Superintendent Eric Mackey told board members that implementing the law won’t be difficult. “We already require career prep as a graduation requirement,” Mackey said. He said the current course was “pretty close” to what the law requires.

“A lot of superintendents were worried we were going to add another course,” Mackey said. “So we’re just modifying the course they already have to take so they don’t have to add a course.”

The state’s current career preparedness course - which covers career development, technology and financial literacy - became a graduation requirement starting with the class of 2017. Just under half of the required 140 hours of coursework are devoted to financial literacy.

Some districts split the course in two sections - A and B. Students can take Career Preparedness A as early as the eighth grade, but it’s left up to local school officials when they offer it. Some school districts, such as Birmingham, also offer additional financial literacy programming that teach students, teachers and staff about investing, credit and loans.

Cathy Jones, who oversees the development of all courses of study for the Alabama Department of Education, told board members a committee reviewed the current career preparedness course and proposed “one little tweak” to meet the requirements in the law.

The tweak the committee proposed, Jones said, is to add standards about taxes, including why taxes are necessary, how they are used, what types of taxes there are and how those taxes are computed.

Those changes will bring the current course up to what the law requires, Jones said.

“A lot of companies were approaching school districts trying to sell them financial literacy programs,” she added, but schools won’t have to purchase anything from an outside vendor.

The law requires students to learn about:

• The types of bank accounts available and how to open and manage their own account,
• How to balance a checking account,
• How to manage credit cards and debt,
• How to evaluate different types of loans,
• The types of insurance policies,
• How taxes work,
• How to calculate interest rates,
• Types of contracts,
• Types of saving and investment tools.

A test, which students will have to take but not pass, is still being developed, Mackey said. School officials are required to report test results to the state Department of Education.

The changes, expected to be approved by the board at their Nov. 9 meeting, will become effective immediately.

Source: Alabama Updates Required High School Personal Finance Course AL.com (November 3, 2023) Trisha Powell Crain