Kokomo Tribune; Kokomo, Indiana

Local News

April 19, 2013

Senator pushing financial literacy bill

Bill held up in House; language added to proposed budget.

— Sen. Brent Waltz, R-Greenwood, is pushing Indiana to adopt the nation’s most comprehensive financial literacy program for schools after seeing desperation and despair on the campaign trail.

When the investment banker first ran for re-election in 2009, the nation was in the midst of a recession and his constituents told him horror stories about their financial woes.

There were people who didn’t know that if they bought a big-screen television using a credit card and only made minimum payments, it would cost them $2,000 and take a decade to pay off.

Others were unaware they had to pay off their student loans, even if they filed for bankruptcy. Some people who had taken out a sub-prime mortgage said they didn’t know their payments would go up by 200 percent after they refinanced.

“There was a great deal of regret I sensed from them,” Waltz said. “They simply did not know they were putting themselves in financial perils.”

He wanted to make sure that didn’t happen to the next generation, so in 2009 he introduced legislation that would require schools to teach financial literacy to students in grades six through 12.

That legislation passed, but it wasn’t exactly effective.

“The legislation did not go as far as I would have liked to see,” Waltz said.

Schools didn’t have any curriculum guidelines. As a result, many never launched a program, the senator said.

This legislative session, he sponsored a new bill that would establish a task force of educators and people in the finance industry to create a financial literacy curriculum.

According to Waltz, schools would receive assistance in implementing these programs from the Financial Literacy Grant Fund. The fund would receive dollars from General Assembly appropriations, as well as gifts, donations and grants from private entities.

The bill passed the Indiana Senate with a 47-1 vote, but got stuck in the House months ago, Waltz said. As a member of the Appropriations Committee, he was able to add the language to the state’s proposed budget to keep it alive.

If that language survives the next week without getting cut, it will become part of the law.

“I’m guardedly optimistic,” Waltz said.

Many area schools already have some financial literacy lessons folded into their curriculum.

Eastern High School will

transition in the coming years to

a financial academy.

Students in the program will take personal finance, accounting, business management and entrepreneurship classes.

The school board has set a goal that all students take a personal finance class, Principal Keith Richie said.

“We’re trying to rev it up a little bit,” he said.

At Northwestern Middle School, eighth-grade students participate in a four-week unit on financial literacy. They learn about savings and checking accounts, debt management and money management. They even write complaint letters to the Federal Trade Commission, Principal Brett Davis said.

He wasn’t quite sure whether this is something schools need to be teaching, though.

“I don’t know if it’s too early at this age or not,” he said. “I don’t think it hurts.”

But maybe it’s something that parents should be teaching instead. Davis said when his son is ready to learn about managing a credit card, he will teach the teen himself.

Many parents don’t teach their children financing, though, mainly because they aren’t familiar with it themselves, Waltz said.

Twenty years ago these lessons were common in schools, but they’ve since fallen by the wayside as there’s been increased emphasis on science and math curriculum, he said.

“We need to correct back to a more balanced approach,” he said.

The senator said it amazes him that the state would mandate kids learn about algebra and trigonometry but wouldn’t make them learn the difference between variable and fixed mortgages. The majority of Americans will take out a mortgage at some point in their lives, he said.

“This is one of the most important things we can teach our kids,” he said.

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