Adult Financial Literacy Framework

PK-2nd
Grade

(Ages 3 – 7)

3rd – 5th Grade

(Ages 7 – 11)

6th – 8th Grade

(Ages 11 – 13)

High School, College
& Adult

(ages 14+ with Beginner, Intermediate & Advanced Levels)

Age Breakdown Reasoning

The development team found that the age breakdowns in existing industry guidelines did not align with student’s cognitive abilities to evaluate key concepts. To address this problem, the NFEC team interviewed educators and sought research to provide evidence-based reasoning for the age breakdowns of the Framework & Standards.

The big ideas, essential questions, and content standards are separated into 4 groups: 1) PK – 2^nd grade, 2) 3^rd – 5^th grade, 3) 6^th – 8^th grade, and 4) teen and adult. The NFEC separated each age range grouping into ‘beginner,’ ‘intermediate,’ and ‘advanced’ categories using Webb’s Depth of Knowledge framework. This design gives the instructor flexibility to assess and push participants to encourage higher levels of achievement.

Both the Core Knowledge Theory and Piaget’s Theory also were explored during standard development. Piaget’s cognitive development theory says that children learn by reconciling inconsistencies through four developmental stages. In some instances the Core Knowledge Theory challenges Piaget’s theory by saying that age or developmental stage matter less than the level at which a child engages with particular theories about the world. Yet while these theories differ in some respects, they also share commonalities. Piaget’s Theory supports current researchers to conclude that effectively teaching kids about money must connect lessons to existing cognitive structures; core knowledge theorists hold that effective education will relate to existing theories or models. Both schools of thought emphasize that children are active learners who filter new information to fit with their current beliefs. (1)

The Financial Literacy Framework & Standards for kids was developed using Piaget’s Theory of Cognitive Development as a model and their understanding of key concepts – separating material based on cognitive abilities (pre-operational ages 2 to7, concrete operational ages 7 to 11, and formal operational for those older than age 11). The NFEC converted the ages to grade levels to ensure that students had the cognitive abilities and skills necessary to successfully complete the lessons at each level.

Above age 11, the framework and standards were separated based on students’ math abilities and understanding. In the 7^th and 8^th grade (ages 11 to 14) students are learning the skills essential to making fundamental personal finance calculations, including negative numbers, rates, decimals, and basic statistics needed to solve personal finance problems.

For younger children, the NFEC also explored the key concepts featured in the report ‘Financial Literacy Programs Targeted on Pre-School Children: Development and Evaluation,’ including development of the concepts of number, time, money and income, value, market and exchange, choice, and social values.

The NFEC asserts that high school students can and should learn advanced personal financial planning topics. Starting in high school, most students possess the cognitive abilities (according to Piaget’s Theory of Cognitive Development) and math skills needed for the majority of the financial literacy lessons. The learning outcomes for high school students and adults of all ages are the same and the standards have been broken down into beginner, intermediate, and advanced lessons based on the Depth of Knowledge framework.

It is important to note that, although the subject matter taught to teens and adults is similar, the NFEC’s Framework for Teaching Personal Finance highlights the importance of understanding the audience and modifying how lessons are taught to maximize appeal to the targeted ages. The Framework also addresses the importance of providing a timely financial education – for example, reaching participants when they are considering a major financial step.

1. Financial Literacy Programs Targeted on Pre-School Children: Development and Evaluation by Karen Holden, Charles Kalish, Laura Scheinholtz, Deanna Dietrich, and Beatriz Novak at the University of Wisconsin-Madison.

Topic Breakdown Reasoning

The topics included in the Financial Literacy Framework & Standards were selected based on 8 years of refinement, research of existing standards, review of academic studies, suggestions from our Curriculum Advisory Board, and feedback from organizations around the globe.

For adults and teens the topics are broken down into 10 personal finance topic areas: Financial Psychology, Budgeting, Account Management, Jobs & Careers, Credit Profile, Loans & Debt, Risk Management & Insurance, Investments & Personal Finance Planning, Entrepreneurship, and Economic & Government Influences.

The kids’ (PK to 8^th Grade) topics are broken down into 5 areas: Financial Psychology / Budgeting, Savings & Investing / Income, Career & Entrepreneurship / Credit, Debt & Loans / Risk Management & Insurance.

When teaching fundamental lessons to kids, the curriculum development team found that many of the lessons were interconnected. That is, curricula for specific lessons bridged many of the separate topics that are included in the teen and adult material. All of the 10 topic areas in the teen/adult package are addressed in the material; however, we considered it best to combine areas for kids to show how the lessons interrelate.

In the Financial Literacy Framework & Standards below you will find big ideas, supporting standards (teen & adult framework), and essential questions (kids’ framework). The big ideas provide the context of what students should learn and show the relationships between critical components. The standards describe what is necessary to achieve the big ideas. The kids’ framework currently provides essential questions and skill sets, the method preferred by our development team; we are currently in process of expanding this framework into content standards.

The NFEC asserts that high school students can and should learn advanced personal financial planning topics. Starting in high school, most students possess the cognitive abilities (according to Piaget’s Theory of Cognitive Development) and math skills needed for the majority of the financial literacy lessons. The learning outcomes for high school students and adults of all ages are the same and are broken down into beginner, intermediate, and advanced lessons.

It is important to note that, although the subject matter taught to teens and adults is similar, the NFEC’s Framework for Teaching Personal Finance highlights the importance of understanding the audience and modifying how lessons are taught to maximize their appeal to the targeted ages. The Framework also addresses the importance of providing a timely financial education – for example, reaching participants when they are considering specific financial decisions.

The NFEC separated each age range grouping into ‘beginner,’ ‘intermediate,’ and ‘advanced’ using Webb’s Depth of Knowledge. It is important to note that many adults need to start at the beginning levels; the majority of adults today have not received the foundational knowledge they need to make financial decisions that align with their long-term goals. This design gives the instructor flexibility to assess and push participants to encourage higher levels of achievement.