Remember when you learned the Pythagorean theorem in high school but then didn’t know how to balance a checkbook once you entered the real world? Yeah, me too. Kind of makes you wonder why more states don’t require students to take a finance class.
Well, if you ever needed further proof that personal finance education is needed earlier in life, you can find it in a new study from the Organisation for Economic Co-operation and Development (OECD), which just released results from a global financial literacy study it conducted among teenagers from 15 different countries.
About 48,000 15-year-olds took a financial literacy quiz in 2015 administered by the OECD’s Program for International Student Assessment (PISA) — and only 12% of test-takers ended up scoring at the highest level of financial literacy. Meanwhile, 22% lacked the most basic financial skills. Students at this level can’t even recognize the value of a simple budget, Angel Gurría, the secretary-general of the OECD, said in the report.
So how did American teens stack up to the competition? They scored exactly at the OECD average — which isn’t necessarily a good thing, considering the overall findings: 22% of U.S. students were among the low performers, while 10% were among the high performers. Below are how all 15 participating countries ranked in the test results:
7. United States
12. Slovak Republic
If there’s one piece of good news, it’s that 64% of these students are already earning a paycheck — even though only a third seem to have the skills to manage a bank account.
Now before you start blaming “kids these days” for slacking on their finances, try taking a stab at some of the sample questions from the PISA test. Questions range in difficulty from basic, financial knowledge (like knowing what’s on an invoice) to ones that incorporate a wider range of concepts, like investing. (Hint: You might find it more challenging than you think.)