Assemblymember Lieu Joins State Schools Superintendent to Promote Financial Literacy

Ontario, CA – Assemblymember Ted Lieu (D-Torrance) today joined Superintendent of Public Instruction Jack O’Connell at an event in Ontario to promote the teaching of basic financial concepts to California school children. Lieu is the chair of the Assembly Committee on Banking and Finance, and is the author of Assembly Bill (AB) 150, which would create a clearinghouse of information for schools to use in teaching financial literacy.

Financial literacy is generally described as the ability to understand basic financial concepts, such as saving and investing.  Nationally, when high school seniors are tested on these concepts, they score 52.5%, or an F- grade.

“We’re simply not preparing high school students to deal with the financial realities that will face them when they move out into the world,” Lieu said.  “This is quickly becoming a national crisis.”

Lieu cited the dramatic effects of the lack of financial literacy.  According to a recent survey, the average college freshman has three credit cards and over $3,000 in consumer debt.  At the same time, the average retirement account is only $49,000.

Worse yet, last year the national savings rate dipped to -1%, the lowest since the Great Depression.  Also, the lack of understanding of finances has been a contributing factor in the explosion of subprime loans, and the meltdown of the mortgage market.

During the event, both Lieu and O’Connell called on Governor Schwarzengger to sign AB 150, Lieu’s bill to provide teachers with resources needed to teach financial literacy to students.  The materials are already available for free from a variety of private sources, so the program will have little to no cost to the State.

“This is a no-brainer for the Governor,” Lieu added.  “AB 150 had tremendous bipartisan support in both houses of the Legislature, and is supported by a wide array of community and industry groups.”