NJ Spotlight


Learning how to handle basic financial decisions such as managing a savings account or responsibly using credit cards will soon be required of middle school students in New Jersey, with the first bill to be signed into law in 2019.

Known as financial-literacy legislation, its adoption comes in response to concerns about serious economic challenges faced by young adults, including the high cost of college tuition that saddles many with hefty debt obligations.

Right now, students in New Jersey receive some instruction on basic financial-literacy issues when they are in high school thanks to a state law that went into effect for the 2010-2011 school year. But under the legislation enacted yesterday, students will now begin to learn about debt and other issues related to “personal financial responsibility” in middle school.

Among the issues to be covered by the new requirement are budgeting, savings, credit, insurance and investment. The lessons will now start in the 6th grade and last through 8th grade.

The bipartisan measure received near-unanimous support in the Legislature and an endorsement from the state’s largest teachers union, before being sent to the governor’s office late last month. It was signed into law during an event at a school in Jersey City yesterday by Lt. Gov. Sheila Oliver, who was serving as governor because Gov. Phil Murphy was in Washington, D.C.

NJ teens often face tough financial decisions

“Financial responsibility is an important acquired and learned-life skill,” Oliver said. “It is a skill that must be a necessary part of our educational curriculum.”

Thanks to current economic trends, many students in New Jersey are already holding down jobs by the time they graduate from high school and are increasingly being asked to make serious, life-changing financial decisions while still teenagers.

For example, some recent studies show New Jersey college students have become among the most-debt-laden in the country as the rising cost of a college education is forcing many to take on significant student loans. The average cost of tuition and fees for in-state students for a single year of instruction at a four-year school in New Jersey has risen to over $14,000, according to the latest data from the College Board.

Lawmakers have portrayed the financial-literacy issue as a broader concern for the state economy, arguing that young adults could be discouraged from buying homes and starting families in New Jersey if they’re struggling for years to pay off student loans or are deep in debt thanks to overuse of a high-interest credit card. Business-lobbying groups have also backed efforts to address the problem, to help stem an outmigration problem that has resulted in the loss of thousands of New Jersey high-school graduates to out-of-state schools each year. “Many young people go into adulthood knowing little about finances and end up making decisions that cost them in the long run,” said Assemblywoman Angela McKnight, a primary sponsor of the legislation.

“Teaching our kids early about the importance of managing their money and making sound financial decisions can prevent them from making costly mistakes and set them on the right financial path,” said McKnight (D-Hudson).

“We don’t expect them to be experts, but they should have a basic understanding of how money works and how it affects their lives,” said Assemblyman Nicholas Chiaravalloti (D-Hudson).

Lessons must start next school year

The new law gives school districts until the start of the 2019-2020 school year to begin administering the financial-literacy lessons. The law empowers the state Board of Education to enforce the new requirement, and calls on the education commissioner to provide districts with sample instructional materials and other resources to help them meet the new teaching requirement.

The law does not specify how much classroom time should be devoted to financial literacy, saying only that the instruction should be “appropriate to, and reflect the age and comprehension of, the students enrolled in the particular grade level.”

The bill was endorsed by the New Jersey Education Association as it moved through the Legislature earlier this year, with the powerful union highlighting the financial-literacy instruction that is already a part of the state’s core curriculum in a previous statement of support.

“This law now will expand the financial literacy curriculum into the lower grades and further the great work being done in our public schools to help our students prepare for and succeed in the world today,” Steve Beatty, the NJEA’s secretary-treasurer, said yesterday.

The bill-signing comes nearly a year after former Gov. Chris Christie rejected an almost identical version of the legislation without explanation in the final days of his tenure in the form of a pocket veto.

“I am delighted the financial literacy bill was signed into law, so students can receive education on key topics that they will need for the rest of their lives,” Sen. Dawn Marie Addiego (R-Burlington), one of the bill’s original sponsors, said yesterday.

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