Florida's financial literacy push is a teaching moment for advisers

Charlie Fitzgerald and other members of the Florida Financial Planning Association had been trying for years to advance financial literacy in the state. They got the ball down the field but not in the end zone.

The Florida FPA was instrumental since 2012 in promoting financial literacy legislation. In 2019, they achieved part of their mission when a law was enacted that made courses available to the state’s high school students, although there was no mandate to take them.

“We settled for the field goal,” said Fitzgerald, principal at Moisand Fitzgerald Tamayo. “We got the elective.”

What the FPA wanted was a financial-literacy graduation requirement. When the pandemic broke out in 2020 and effectively shut down lobbying in the Florida statehouse, FPA did not have high hopes of taking the next step. Their members couldn't meet with lawmakers in their offices or buttonhole them in Capitol hallways.

Suddenly this year, they scored a touchdown when they weren’t even on the field. The Florida House and Senate unanimously approved the Dorothy Hukill Financial Literacy Act, and it was signed into law by Gov. Ron DeSantis on March 22. It mandates that Florida high school students, beginning with the freshman class in 2023-24, take one semester of financial literacy.

Read more: Does taking a financial literacy course in high school make a difference? 

Fitzgerald attributes the political momentum for the bill in part to a desire by some of Hukill’s colleagues to see the measure through after she passed away in 2018. She had been the financial literacy champion in Tallahassee.

The wellspring of emotion “was an element of this, believe it or not,” Fitzgerald said. “No elected official voted against it, which is a pretty powerful statement.”

The push to put financial literacy in the high school curriculum is the other side of the coin from one of today's hottest political issues — parental control of their kids' education. Most of the debate has focused on putting a halt to teaching about sexuality in elementary schools. The effort on personal financial education is much quieter. It involves adding something to the curriculum. But it also is an effort to dictate how teachers do their jobs. Understandably, that creates tension.

If advocates want to establish mandates in the 25 states that do not require financial literacy education, they'll have to overcome opposition from teachers' unions — which want to preserve teachers’ classroom prerogatives.

As the son of two teachers, I have great respect for educators. I don’t like it when politicians and activists tell them how to teach kids, as if they don’t have their students’ best interests at heart.

But teachers, lawmakers and others with influence over what is taught need to be persuaded that financial literacy should be a core topic. This is where financial advisers can help. They know better than anyone else in the community the complexities of personal financial management and how it contributes directly to quality of life.

“Financial literacy today is as important as reading and writing,” said Annamaria Lusardi, professor of economics and accounting at George Washington University in Washington, D.C. “It is an essential skill young people need to understand the world around them and participate in society.”

Lusardi, founder and director of the Global Financial Literacy Excellence Center, points out that high school students must grasp the meaning of debt as they try to determine where to go to college and how much to pay.

They need to know not just about their personal debt and maintaining a bank account. But they also should have some feel for the enormous debt the United States is carrying and the implications of rising interest rates, market volatility and geopolitical risk on their personal finances.

“We don’t need another crisis,” Lusardi said. “We have seen enough to add financial literacy [courses] in schools.”

If most young Americans are required to learn the basics of finance, it could help create a more vibrant market for financial advisers. One of the topics in the required Florida course is building wealth through investing.

If students add to that basic knowledge in further education, by the time they turn to advisers for help, they'll be knowledgeable, engaged and perhaps even tough customers. Of course, they might also decide they can handle their own financial lives and avoid advisers. But I bet the former outcome is more likely.

Before getting to that point, more states will have to require financial literacy. Fitzgerald said the subject is “like a foreign language” that students must learn.

“Those who enter adult life without the basics of personal finance do so at their peril,” Fitzgerald said. “That’s what [the Florida law] is addressing.”

That’s a message more state lawmakers must hear because all of society pays the price for low levels of financial know-how, Lusardi asserts.

“Policymakers need to wake up,” she said.

Education policy is set at the state and local level. You can follow the progress of financial literacy requirements through the Council for Economic Education, which puts out a Survey of the States every two years, and also through the National Conference of State Legislatures.

Financial advisers are needed not only in the political vanguard to promote financial literacy legislation. They also can help educators learn how to teach personal finance.

“Financial planners have a role to play,” Fitzgerald said. “We really need financial planners to step up and make [financial literacy] something that’s meaningful in students’ lives.”

It may take many years — and a lot of playing between the 20-yard lines — to convince state legislatures to act. If advisers are in the game, it’s more likely states will score financial literacy touchdowns.