THE FINANCIAL LITERACY GAP IN TODAY’S HIGH SCHOOLS:

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THE DEVELOPMENT OF CRITERIA FOR A FINANCIAL LITERACY
CURRICULUM MODEL
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by
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Marci Klinger

A dissertation submitted to the Faculty of Robert Morris

University in partial fulfillment of the requirements for
the degree of Doctor of Philosophy with a major in
Instructional Management and Leadership

November 18, 2010

 UMI Number: 3528367

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Copyright 2011 Marci Klinger

All Rights Reserved

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 Acknowledgements

I would like to first and foremost thank the Lord above for
guiding me in this process and letting me achieve every
goal I have had in life.

I would like to thank my husband, Todd, for supporting me

and encouraging me to follow my dreams.

To my parents, Rose and Paul McManus, for being the best

parents a child could have. I have learned so many core
values from the both of you and I do believe that you are
both my angels.

To my brother Kevin, Aunt Emma, Sue, Nona, Cindy and Don

and all my friends who are so important to my life and have

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helped to shape the person I am today.

To every teacher I have had.

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To Cohort 4, I have relied on all of you at one time or
another throughout this process. Thank you from the bottom
of my heart.
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To Dr. Cellante who has helped me through undergraduate,

graduate and my doctoral degree. Her countless hours of
reading and revising my dissertation have not gone
unnoticed.
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To Dr. Shelley and Dr. Hansen my committee for tedious

hours of reading and helping me revise my dissertation.

To Dr. Semich and Patty Zusinas for helping me to get into

this program and always encouraging me.

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 ABSTRACT

Financial literacy is an essential survival skill for

students in today’s economy. However, financial education

is not always included in school curricula despite a

growing need for students to be financially literate. This

qualitative study discusses descriptive information on

what/when to teach concepts related to financial literacy

in schools. All participants were teachers who attended

the Governor’s Institute on Financial Education in July of

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2009. The purpose of the study was to present criteria for
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a model curriculum for financial literacy in high schools

in Pennsylvania. Four research questions were answered:

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1)what financial literacy curricula exist today, 2) what

types of learning activities are teachers using in the

financial literacy course, 3)what specific content areas

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should be addressed in a financial literacy course, and

4)how much time is devoted to each of the content areas?

The findings revealed that 21 curricula are accessible to

business teachers; however, five are primarily

used. Various learning activities are used in a financial

literacy classroom including: worksheets, discussing bank

statements, buying a car, using credit cards, and

discussing interest rates. Participants also discussed

using technology on a regular basis and showing DVD’s on

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financial topics. Assessment of these learning activities

comes in the form of tests, quizzes, projects, worksheets,

oral presentations, group work, self-assessment, class

participation, notebooks, role-playing, homework, and

hands-on activities, such as simulations.

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 TABLE OF CONTENTS

CHAPTER I

Introduction...............................................1

Background of Study...................................1

Statement of the Problem..............................3

Significance of the Study.............................4

Research Design.......................................6

Limitations of the Study..............................6

Definition of Terms...................................7

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CHAPTER II
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Review of Literature.......................................9

Financial Crisis in the United States of America......9

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Financial Crisis in Pennsylvania.....................17

The Need for Financial Literacy in High Schools

Surveys Administered.................................18
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Families Teaching Financial Literacy.................24

Who Is Teaching Financial Education in Pennsylvania?.25

Developing a Curriculum..............................26

Standards for Financial Literacy.....................27

The Downside of Financial Literacy Offered in High

Schools..............................................30

CHAPTER III

Research Methodology......................................34

Action Research......................................34

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 Research Design......................................35

Participants.........................................35

Data Collection......................................36

Data Analysis........................................40

Ethical Considerations...............................44

CHAPTER IV

Results...................................................45

Restatement of Problem...............................45

Background Information...............................46

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Findings.............................................53
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Research Question 1 Findings.........................53

Research Question 2 Findings.........................64

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Research Question 3 Findings.........................66

Research Question 4 Findings.........................70

CHAPTER V
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Discussion................................................73

Findings.............................................74

Emerging Themes......................................81

Interpretations......................................87

Criteria For A Model Curriculum......................88

Recommendations......................................90

Future Research .....................................92

Conclusion...........................................92

References................................................94

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 Works Cited..........................................94

Appendix A...............................................108

IRB Approval........................................109

Email to Participants...............................110

Letter to Participants..............................111

Participant Consent Form............................112

Appendix B (Pilot Test)..................................114

Interview Questions.................................115

Appendix C ..............................................118

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Interview Questions Revised.........................119
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Appendix D...............................................122

Sample Learning Activities..........................123

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Appendix E ..............................................157

Sample Teaching Materials...........................158

Appendix F ..............................................161
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Sample Lesson Plans.................................162

Appendix G ..............................................169

Sample Final Examination............................170

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 LIST OF TABLES

Table 1 How Long Have You Been Teaching?..................46

Table 2 At What Level Is It Being Taught?.................47

Table 3 Reasons Why a Course in Financial Literacy Is

Important.................................................49

Table 4 Number of Students Taking Course?.................49

Table 5 How Long Has The Course Been Offered?.............50

Table 6 At What Grade Level Should It Be Required?........50

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Table 7 How Long Is The Course Taught?....................51
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Table 8 How Many Teachers Are in Your Department?.........52

Table 9 What Departments Teach Financial Literacy?........52

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Table 10 Curriculum 1.....................................55

Table 11 Curriculum 2.....................................57

Table 12 Curriculum 3.....................................59

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Table 13 Curriculum 4.....................................60

Table 14 Curriculum 5.....................................61

Table 15 Best Feature of Curricula........................63

Table 16 Use of Curricula.................................63

Table 17 Which Curricula Do You Prefer?...................64

Table 18 Content Areas of Learning Activities.............65

Table 19 Content Areas and PA Standards...................68

Table 20 What Are the Most Important Content Areas?.......69

Table 21 Computer Access, How Often Do You Use It?........70

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Table 22 Content Areas and Time Devoted to Each Content

Area .....................................................71

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 1

CHAPTER I

Introduction

Background of Study

The second president of the United States, John Adams

stated, “All the perplexities, confusion and distress in

America arise, not from defects in their constitution…not

from want of honor or virtue, so much as from the down

right ignorance of the nature of coin, credit and

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circulation” (Buck, 2008; “John Adams Quotes,” n.d.).
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President Adams recognized the need for education in

finances almost 220 years ago. Yet still in 2010 our

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economy is in crisis, and our national debt is snowballing

out of control. With rising rates in bankruptcy, constant

use of credit cards, and unprecedented foreclosures on

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houses, now more than ever students need to be educated in

financial literacy. Many in our country are experiencing

economic hardships, and students who are leaving high

school are not equipped with the skills and knowledge

necessary to survive financially. According to the

JumpStart Coalition (2008), financial literacy is the

ability to use knowledge and skills to manage one’s

financial resources effectively for a lifetime of financial

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security, and financial literacy can and must be taught by

every high school across the United States.

For generations Americans have had to balance

checkbooks, buy and sell houses, understand interest rates,

and deal with the costs of goods sold. Recent events

including increases in foreclosures, the stock market

downturn, and the uncertainty of Social Security have led

the nation to question what can be done to prevent this

from happening in the future. “Financial literacy is

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closely connected to an individual’s emotional, personal,
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social, economic, and employment success” (“Iowa Core

Curriculum,” n.d.).
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According to Jacobs, Hudson, and Bush (2000),

“financial education can improve financial literacy and,

even more importantly, change financial behavior for the

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better.” Not only is it essential to teach students

financial literacy but it is essential to develop

curriculum that addresses state standards and is

meaningful. Curriculum development is an essential part of

education, since curriculum guides instruction in the

classroom. A strong curriculum is a critical component of

a strong program at any school, it needs to be up to date,

relevant, and support instruction. Curriculum can be

defined in many ways. According to Hunkins and Ornstein

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(2003), a broad definition of curriculum states that it is

a field of study, whereas a more narrow definition is that

curriculum is a written document that includes strategies

for achieving desired outcomes. Hunkins and Ornstein

affirm there are six components of curriculum: aims, goals,

objectives, subject matter, learning activities, and

evaluation. The goal of this dissertation is to discuss

criteria for a model curriculum in financial literacy that

educators in Pennsylvania can use that is aligned with the

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Pennsylvania Department of Education’s Standards.
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Currently, financial literacy is taught in many

departments and it appears different but overlapping

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material is being taught. Business teachers teach Personal

Finance, math teachers teach Consumer Math, social studies

teachers teach Consumer Economics and finally, and family

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and consumer science teachers teach Adult Roles. These

classes cover similar topics.

Many companies have developed curricula for financial

literacy. This study explores those curricula and gives

perceptions of teachers who are using them.

Statement of the Problem

Given the increase of financial illiteracy in the

United States, a model curriculum is needed for teaching

financial literacy in high schools. This study presents

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criteria for a model curriculum and discusses the current

status of financial literacy in high schools using these

research questions:

1. Research Question 1: What financial literacy

curricula exist today?

2. Research Question 2: What types of learning

activities are teachers using in the financial

literacy course?

3. Research Question 3: What specific content areas

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should be addressed in a financial literacy course?
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4. Research Question 4: How much time is devoted to each

of the content areas?

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Using 12 phone interviews, this study explores

business teacher’s perceptions of financial literary,

focusing on content necessary in a financial literacy

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class.

Significance of the Study

According to Personal Finances in America (2002),

Americans’ personal saving rates dipped into negative

territory in 2000. This has not happened since the Great

Depression. Today’s students are the leaders of tomorrow

and our economy will be worse off ten years from now if a

change does not take place. Alan Greenspan, former Federal

Reserve chairman, agrees, “Our children are financially

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illiterate and unable to inherit the global economy unless

we start to educate them in elementary school (Godfrey,

2006, p. 22).

Currently, many Americans are living well outside of

their means and have more charges on their credit cards

than money in their savings accounts. If this trend

continues, the rate of savings could be even more alarming

in the next 10 years. If Americans do not act now, the

nation could experience fatal consequences.

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Some kids do not have parental help with learning how

to manage their finances.

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“Many parents are unwilling or

unable or uncomfortable about providing financial education

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to their kids, or they’ve made mistakes themselves, or are

part of the unbanked population. They are not going to be

able to give their kids much guidance” (Manzo, 2008, p.

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24). Carpenter agrees stating, “Many children have

‘pushover parents,’ who say yes to anything, say some

experts, and those parents, who may be in debt, are just

passing their own bad habits on to their kids” (Carpenter,

2005). Parents have an enormous influence on their

children’s lives.

It is imperative for schools in the United States to

teach Financial Literacy and this research develops

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recommendations for a model curriculum to provide data that

is necessary to bring us one step closer to this goal.

Research Design

The purpose of this qualitative study was to present

criteria for a model curriculum for high schools to follow

regarding the teaching of Financial Education in

Pennsylvania.

Twelve teachers of financial literacy who attended the

Governor’s Institute were selected as the sample,

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representing schools all over Pennsylvania.
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Creation and pilot of an interview took place in

November of 2009. The pilot study was effective and

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interview questions were added. A letter was sent to 25

financial literacy teachers in January 2010 asking for

their participation in phone interviews to develop criteria

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for a model curriculum for financial literacy. Appointments

for phone interviews with the teachers who teach the

financial literacy course were arranged at a time

convenient for the participants. Once all interviews were

completed, the researcher coded the data. The results were

then presented.

Limitations of the Study

The study is limited to business teachers who teach

financial literacy and who have been invited to the

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Governor’s Institute for Financial Education. These were

teachers who have been given a week’s worth of instruction

on financial literary. The criteria discussed for the

model curriculum is based on the Pennsylvania State

Standards and will not be generalized to other states.

According to Creswell (1994), by doing interviews the

researcher is getting the information indirectly filtered

through the views of the interviewees. Also, a natural

field setting is missed. Another limitation is that the

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researcher cannot observe the body language of the

participant.
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Definition of Terms
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The following terms are defined as they are used in this
study:

Assessment: A valid and reliable measurement of student

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performance on a set of academic standards in a subject

area that captures student understanding of the set as a

whole and the central concepts, knowledge and skills of

each content area (Chapter 4, 1999).

Curriculum: A series of planned instruction aligned with

the academic standards in each subject that is coordinated

and articulated and implemented in a manner designed to

result in the achievement at the proficient level by all

students (Chapter 4, 1999).

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Financial Literacy: the ability to use knowledge and

skills to manage one’s financial resources effectively for

a lifetime of financial security (Jump$tart Coalition,

2008).

Learning activities: The tasks undertaken, which specifies

the type of task, the techniques used, associated tools and

resources, the interaction and roles of those involved and

the assessments associated with the learning activity

(JIME: A learning design toolkit: A definition for learning

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activities, n.d.).

Planned instruction:
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Instruction offered by a school

entity based upon a written plan to enable students to

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achieve the academic standards under § 4.12 (relating to

academic standards) and additional academic standards

determined in strategic plans under § 4.13 (relating to

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strategic plans) (Chapter 4, 1999).

State Academic Standards: Content a student should know and

be able to do at a specified grade level(Chapter 4, 1999).

In short, financial literacy is an ongoing problem in

the United States. It is imperative that we delve deeper

into the subject and clarify what should be taught. In

Chapter 2, a review of current literature is examined in

detail.
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CHAPTER II

Review of Literature

The review of literature in the following chapter is

broken down into eight sections. Combined these sections

give the reader a portrait of the importance of Financial

Literacy in schools and helps to shape the method, results,

and discussion sections that follow. The relevant research

is discussed in the following sections:

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1. Financial Crisis in the United States of America

2. Financial Crisis in Pennsylvania

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3. The Need for Financial Literacy in High Schools—

Surveys Administered
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4. Families Teaching Financial Literacy

5. Who is Teaching Financial Education in Pennsylvania?

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6. Developing a Curriculum

7. Standards for Financial Literacy

8. The Downside of Financial Literacy Offered in High

Schools

Financial Crisis in the United States of America

Eighty years ago, Herbert Hoover made the comment,

“Blessed are the young for they shall inherit the national

debt” (Hoover, n.d.). Recently, American’s financial

crisis has spun out of control. Wall Street plunged into

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chaos on September 30, 2008, when, according to Settle

(2008), “The Dow Jones fell past its previous record drop

of 721.56 in a day, set after the 9/11 terror attacks.”

Americans watched as stocks plunged and people ready to

retire realized that they might have to work longer.

Students do not understand the tremendous impact that this

has had on older Americans who have invested everything

they have in the stock market. If schools offer finance

classes, students may become more aware of the significance

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of financial knowledge.
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On February 9, 2009, President Obama stated, “As we

speak, our country is in a full blown crisis and needs a

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drastic government response, continuing failure to act

could turn a crisis into a catastrophe” (“Obama: ‘Only

Government,” n.d.). The echo of the president’s remarks is

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felt around the nation.

Upon graduation from high school, graduates are

bombarded with credit cards offers. On average, these

teens are solicited by eight credit card companies their

first week of college (Godfrey, 2006). Nearly 83 percent

of college students have at least one credit card and 45

percent have an average credit card debt of $3,000. If

borrowers owing $3000 make the minimum payment, it will

take them 30 years to pay the debt off. In 2006, 150,000

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young adults between the ages of 18-24 declared bankruptcy.

More people file for bankruptcy than graduate from college

(Godfrey, 2006). College students are piling up so much

debt that they cannot pay; therefore, many are forced to

drop out of college while others pursue more drastic

measures such as suicide (“EDITORIAL: Misinformed: Students

Need More Financial Sense,” 2008). Students receive a

credit card offer in the mail that reads zero percent for

12 months. Many believe they will have money in 12 months,

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so they sign up. It is important to disseminate accurate
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financial information to avoid this predicament.

According to Colleen Kelly, VP, State Government

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Affairs, Credit Union National Association,

The role that financial illiteracy plays in our

nation’s social and economic tragedies must be clearly

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demonstrated to parents, teachers, policymakers and

citizens. Financial illiteracy results in poor

spending, saving, and investment decisions. The

stress of financial insecurity can lead to crime,

suicide and domestic violence. Such poor decisions

can lead to consumers using excessive credit, often

times at exorbitant rates. (Kelly, 2002, p. 11)

“The United States Census estimates in the fiscal year

that ended on September 30, 2002, the Administrative Office

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of the U.S. Courts determined that there were 39,091

business bankruptcy filings and 1,508,578 non-business

bankruptcy filings in this country in that year. These

statistics mean that one out of every 191 individuals in

the country, including a number of children, filed for

bankruptcy in fiscal 2002” (“How Many People File”, n.d.).

Furthermore, Zibel (2008) states that more than 800,000

personal bankruptcy filings were made in 2007, compared

with more than 573, 000 in 2006. In addition, The Wall

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Street Journal reports personal bankruptcy filings hit 1.41
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million last year, up 32% from 2008 (Dougherty & Murray,

2010). The financial crisis has a spiraling effect. For

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example, Casselman (2009) discusses a ripple effect

occurring when an individual loses a job. He discusses a 42

year old father of four whose position was eliminated. The

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father no longer needs daycare services and taking his

family out to eat is no longer an option. Weekly dry

cleaning of his business suits is now eliminated and large

purchases are out of the question (Casselman, 2009, p. 12).

So many businesses are affected by one man losing his job.

If these individuals would have been educated on financial

literacy, this statistic would/could have been lower.

Families could have been saved from embarrassment and

having everything taken away from them. Two years later in