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Schools Play Financial Literacy Catch-Up

BOSTON ( TheStreet) -- In his recent State of the Union address, President Barack Obama spoke of seeing a "Sputnik moment" for the nation's education system and the need to better prepare students with skills in math and science.

On the heels of the Great Recession, one might consider adding financial literacy to the list of skills students lack.

There have been improvements in how financial literacy is taught in schools, experts say, but few states require it to be taught at all.

Over the decades, money management lessons for kids have rarely ventured far beyond the "always count your change" variety of advice sandwiched between Saturday morning cartoons. (Sometimes the advice comes from a more interesting source. Here's a look at 8 Money Lessons From Dr. Seuss.) Given the increasingly complex world of modern personal finance, a new push is under way to ensure youth are ready for the challenge.

"We've made some strides in the past few year, but we have a long way to go," says Laura Levine, executive director of the Jump$tart Coalition for Personal Financial Literacy. "We kind of started from nowhere, so we've made tremendous strides. But we are not even close to calling it a day. We're just starting. There's a lot more that needs to be done both in terms of the quantity and quality of financial education."

The nonprofit, based in Washington, D.C., is a partnership of about 150 organizations, government agencies, academic institutions and corporations including American Express (AXP - Get Report), the JPMorgan Chase (JPM - Get Report) Foundation, Bank of America (BAC - Get Report), Morgan Stanley (MS - Get Report), Visa (V - Get Report), Citi (C - Get Report) and Wells Fargo (WFC - Get Report).

At its site, Jump$tart features an interactive map that breaks down which states have formalized financial literacy programs in place for their school systems. Among the notable exceptions are California, Washington, Oregon, New Mexico and Florida.

The Council for Economic Education, a six-decades-old advocacy group for financial education in K-12 schools, issues a periodic assessment of state-by-state performance on that front. Its most recent report, covering all of 2009, found that the number of states requiring students to take an economics course as a high school graduation requirement increased from 17 in 2007 to 21 in 2009. Only 19 states require the testing of student knowledge in economics, though, four fewer than in 2007.

The states requiring students to take a personal finance course (or learn personal finance as part of an economics course) as a high school graduation requirement increased from seven in 2007 to 13 in 2009. Five states require entrepreneurship to be included as a component of a high school course -- usually economics -- for graduation, up from three in 2007.
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