Financial Literacy Legislation and Policy Initiatives to Advance Financial Education

Financial instability is a chronic, pervasive force undermining the health and well-being of tens of millions of Americans. From delayed preventive care and skipped medications to rising suicide rates and worsening chronic diseases, the effects of economic distress are measurable, avoidable, and lethal. Financial instability is a public health crisis.

Recognizing financial instability as a public health emergency (PHE) will empower state and federal agencies to respond with the urgency, funding, and infrastructure this crisis demands – ultimately saving lives, reducing long-term healthcare costs, and building healthier, more economically resilient communities.

This proposed response centers on integrating financial capability services (financial education and counseling) as a proactive public health strategy – equipping students with essential financial skills and providing counseling for adults in crisis. Expanding access to these resources empowers individuals to regain stability and build lasting financial resilience.

In today’s rapidly changing world, education must evolve to meet students’ practical needs, equipping them with the skills to navigate a complex global economy. Yet despite this necessity, our current education system remains stuck in a model that prioritizes traditional subjects over practical life skills. Financial Literacy, Entrepreneurship, and Career Readiness (FLEC) subjects address these gaps, providing students with the tools to build stable, independent lives. It is time we make FLEC education a cornerstone of school curricula across the United States.

Building on the success of STEM (Science, Technology, Engineering, Math) as a model, the NFEC created the FLEC Subjects brand to expand partnerships and opportunities. By integrating entrepreneurship and career readiness alongside financial literacy, FLEC attracts business leaders, employers, and organizations to raise critical awareness about the lack of education on how to earn and manage money – essential life skills that benefit 100% of youth.

The Financial Empowerment Education Act is the first proposal to ensure that high school students receive 4 years (8 semesters) of financial literacy education and proposes a comprehensive approach to integrating personal finance education into K-12 school curricula. This legislation encourages states to mandate financial literacy courses as a graduation requirement while also providing educators with the training and resources necessary to deliver high-quality instruction. The act emphasizes the importance of measurable outcomes, ensuring that students not only learn critical financial concepts but also develop practical skills to apply them in real-life situations.

Key objectives of the Financial Empowerment Education Act include providing every youth who graduates with the capabilities to make near-term financial decisions, ensure that the education they receive meets minimum education standards applied to all core subjects, and ensure enough time, rigor, and spaced repetition to make a lasting difference.

Federal student loans to minors are predatory because they 1) target a vulnerable population lacking the life experience to consent, 2) are issued without a realistic assessment of the borrower’s ability to repay, and 3) expose young people to long-term harms like delinquency, default, and damaged credit. Children under 18 are generally protected from binding financial contracts, but federal student loans are a notable exception. Minors can legally take on large loan obligations without parental consent or basic safeguards, exposing them to long-term financial risk. 

Rigorous, performance-based financial education reduces the predatory nature of student lending by turning vulnerable borrowers into informed decision-makers. It teaches students to evaluate education choices through an ROI lens, decode loan terms through applied exercises, and demonstrate readiness with performance-based checks before borrowing. Paired with budgeting and repayment training, pre-borrowing counseling, family engagement, and outcome tracking, this approach closes the information gap predators exploit and lowers the risk of long-term harm.

Recognizing that, while college can be a beneficial investment for some, it results in negative financial outcomes for many, this legislation requires students to complete two years (four semesters) of personal finance education in their undergraduate years. The curriculum includes instruction on entrepreneurship, career planning, money management, and financial readiness, aiming to equip students with the skills necessary to navigate their financial futures effectively.