According to the Council for Economic Education, nineteen states now require students to study personal financial as a condition for graduating from high school. But does financial education work? The simple answer is no, teaching financial literacy is worse than the financial decision those students can make any time soon. Financial education fails to change the way people handle money, and the blind faith in these lessons to solve financial problems conceals the crucial facts about the country’s economy.

The reason most American’s have awful finance is not due to their failure to budget or the lack of understanding of interest rates, American’s finances are in shamble because of the high cost of health insurance, education, rent, utility bills, and childcare compare to the low paychecks. And no amount of financial literacy is going to close the gaps like that.

Finance News Today – American’s expenses and incomes

There is also another factor that explains why financial classes don’t have much impact on your financial life. The courses of most financial literacy classes don’t match up with the actual financial choices and economic realities many people face. Financial literacy is usually determined by your ability to correctly answer a question like “assuming you have $200 in a savings account which pays 12% interest, compounded yearly, what will you have after three years?

Recent research has found that American’s expenses and incomes are far more volatile than most financial literacy education takes into account – this is particularly true for people making less income than the average class. Perhaps the financial education could be designed to align more closes with the financial choices and needs of ordinary Americans and devise a way to impact this at the right moment. Until then, the students would be much better off spending their time in the regular math classes, rather than studying financial education programs.