Does financial literacy education during the formative teenage years increase long-run retirement savings? Probably very little, according to the TIAA Institute, which sponsored research analyzing data from the 2012, 2015 and 2018 waves of the National Financial Capability Study.
The research, authored by Melody Harvey of the University of Wisconsin-Madison and Carly Urban from Montana State University and the Institute for Labor Economics, notes that 24 states impose some requirement for education around personal finance.
Among the overall population, the research found, there is no evidence that financial education in high school improves the likelihood of having a retirement account, having a non-retirement savings account or owning a home among adults ages 25 to 40.
In addition, there's no clear evidence that such education decreases stress related to retirement savings, increases the likelihood of planning for retirement or reduces the likelihood of borrowing from one’s retirement account.
Because prior research has found that high school financial education improves outcomes related to credit and debt, the researchers concluded that priority topics for such classes should include budgeting, credit, debt and saving for emergencies before addressing retirement savings.
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