By Sarah Ostergaard
As April progresses and tax deadlines approach, South Carolinians are either done with the forms or frantically sorting through documents and tracking down paperwork. Both might be asking a familiar question: Why didn’t we learn this in school?.
For years, personal finance – taxes, credit, budgeting – was something most people picked up the hard way. That is changing for the better since South Carolina became the 15th state in the nation to require at least a half credit Personal Finance course to graduate from a SC high school. During Financial Literacy Month and at a time when tax season highlights just how complicated money matters can be, that’s a welcome development. This is old news since the change was brought about through a provision in the 2022-2023 state budget. So those who continue to ask, “Why don’t they learn this in school?.” can rest assured that they do, beginning with the entering high school freshman class of 2023–24.
Students today are learning how to read a paycheck, make a realistic budget, choose insurance, manage a bank account, think critically about credit cards and loans, and more personal finance tasks. For many adults, this kind of preparation would have made early financial decisions a lot less stressful. Maybe more of us would have understood the importance of compound interest and long term investments.
South Carolina is in line with national trends. A recent report in The Wall Street Journal highlighted the growing emphasis on personal finance courses in many states, but noted that some schools are shifting focus toward personal finance and away from more traditional economics courses. While the rise of financial literacy is widely seen as positive, it should not be at the cost of the economics course. The idea of “ditching economics” has sparked debate for good reason: personal finance does not exist in a vacuum. Personal finance is built on the principles of economics.
Understanding the financial cost of an interest rate on a loan is very important. And understanding why interest rates rise and fall, how the Federal Reserve responds to inflation and unemployment rates, how borrowing and saving affect the broader economy, how businesses make resource allocation decisions is also very important. These are all economic principles.
Likewise, learning to create a realistic budget is valuable. And understanding supply and demand, why prices increase, thinking through opportunity costs, or how wages are determined adds a deeper layer of insight that helps students make smarter decisions over time. Interest rates and budgets are built on the foundation of economics. Even money itself is shaped by economic forces – it is an economic good, subject to the laws of supply and demand.
Without the economics foundation, personal finance can become a set of rules to follow, rather than a system to understand.
Thankfully, economics remains a high school graduation requirement, included in the state’s Social Studies standards. In addition to personal finance coursework, students are still expected to learn key economic concepts that explain how markets function and how financial systems operate.
That balance matters. When students learn both subjects, they gain not only practical skills but also the context behind them. Students learn the terminology and cause / effect relationships to become more equipped to connect the dots between their personal financial choices and the larger economic environment to which they will meaningfully contribute as consumers, producers, leaders, and voters.
Tax season offers a clear example. Filing a tax return falls squarely under personal finance. Understanding why tax policies change, how government spending is funded, or how policy choices influence tax decisions is economics.
The Personal Finance and Economics courses both help prepare students for real life in a way that neither fully accomplishes alone. Thankfully, our SC high schools currently help teach students how to file taxes and understand money, decisions, and the systems that shape them. Hopefully our policymakers continue to require both Personal Finance and Economics courses so schools continue striking the right balance between practical financial skills and the economic principles behind them.
And for those currently wrestling with their own tax forms, it may be encouraging to know that today’s students are getting a head start.
