knowledge found within American society illustrates that leaving personal finance lessons to
parents leads to inequality. 14 Low proficiency in financial knowledge is particularly prevalent
among socially marginalized groups. 15 Unlike parents that are more financially literate and able
to impart important financial concepts onto their children, parents that are financially illiterate are
not able to teach their children important financial skills that will help them transform their
financial future. 16
Unfortunately, traditionally marginalized segments of our society have systematically
been denied equal participation in the American economy, 17 and while these groups have
achieved tremendous progress towards equality, there is much work yet to be done. 18 As these
groups struggle to overcome the impact of centuries of economic discrimination and gain a
foothold in the American economy, they face an uphill battle in even obtaining access to many
financial tools. Understanding and teaching those tools requires an even greater level of
knowledge than merely knowing what financial tools exist; it requires the ability to explain which
tools apply to a situation, why they apply, and how to use them. Put simply, not all Americans
have been provided with the range of tools necessary to attain their financial tool belt or the
knowledge needed to use those financial tools. 19
Given the prevalence of economic instability illustrated by the cyclical nature of our
financial crises, 20 the growing numbers of the working poor, 21 and the increasing dependence on
government support programs for basic survival, 22 this Article argues that we should not leave the
financial education of children to their parents alone. Each of these identified issues emanates in
part from poor financial decision-making. 23 A more relevant example of the effects of financial
14 See Kadlec, supra note 13 (asserting that financial literacy “accounts for as much as 50% of the wealth gap” in America).
15 Tami Luhby, Worsening Wealth Inequality by Race, CNN MONEY (June 21, 2012),
http://money.cnn.com/2012/06/21/news/economy/wealth-gap-race/index.htm; FINRA INVESTOR EDUC. FOUND., supra note 12, at 19-
20. These marginalized groups include women, African-Americans, Hispanics, and the undereducated. Id.
16 See KIYOSAKI & LECHTER, supra note 1, at 9 (stating that the “poor” cannot teach their kids financial skills).
17 Anabela Dinis, Entrepreneurship in Minority Groups: A Process Needed for Both Social Cohesion and Economic Development,
ENTERPRISINGMATTERS EMAG., www.isbe.org.uk/AnabelaDinis#sthash.OlFaep T2.dpuf (last visited Nov. 10, 2013) (explaining that
marginalized groups often are denied access to key activities of society such as economic participation).
18 See Leadership Conference on Civil Rights & Leadership Conference on Educ. Fund, Justice on Trial: Racial Disparities in the
American Criminal Justice System, LEADERSHIP CONF., http://www.civilrights.org/publications/justice-on-trial/ (last visited Nov. 22,
2013) (“America’s minorities now enjoy greater economic and educational opportunities than at any time in our history. While it
certainly cannot be said that the United States has achieved complete equality in these areas, we continue to make slow but steady
progress on the path toward that goal.”).
19 The tools necessary to a healthy financial tool belt might include checking and savings accounts, retirement savings accounts, a
budget, credit building tools such as credit cards, varied investments, mortgages, lines of credit, countless other financial products,
and, most importantly, the knowledge to properly utilize those tools.
20 See generally ECONOMIC DISASTERS OF THE TWENTIETH CENTURY 182–235 (Michael J. Oliver & Derek H. Aldcroft eds. 2007)
(laying out the cyclical nature of financial crises in America’s economic system).
21 Michael Snyder, The Census Revealed America’s Fastest Growing Class: The Working Poor, BUS. INSIDER (Dec. 27, 2010),
http://www.businessinsider.com/the-working-poor-2010-12 (explaining that today one out of every three American families are low
income); see RICH MORIN & SETH MOTEL, PEW RESEARCH CTR, A THIRD OF AMERICANS NOW SAY THEY ARE IN THE LOWER
CLASSES 1-2 (2012), http://www.pewsocialtrends.org/files/2012/09/the-lower-classes-final.pdf (indicating that Americans place
themselves in lower income brackets than in previous years). The number of Americans describing themselves as lower-middle or
lower class has grown from approximately a quarter in 2008, to nearly a third in 2012. Id. at 1. The number of Hispanics that describe
themselves as lower-class has also grown from thirty percent in 2008 to forty percent in 2012. Id. African-Americans have held
steady, with approximately thirty-three percent classifying themselves as members of the lower or lower-middle classes. Id.
22 Tami Luhby, Government Assistance Expands, CNN MONEY (Feb. 7, 2012),
http://money.cnn.com/2012/02/07/news/economy/government_assistance/. “The federal government sent a record $2 trillion to
individuals in fiscal 2010, up nearly 75% from 10 years earlier.” Id.; see BERNICE L. BOURSIQUOT & MATTHEW W. BRAULT, U.S.
CENSUS BUREAU, DISABILITY CHARACTERISTICS OF INCOME-BASED GOVERNMENT ASSISTANCE RECIPIENTS IN THE UNITED STATES:
2011, at 2 (Feb. 2013), https://www.census.gov/prod/2013pubs/acsbr11-12.pdf (“In 2011, nearly 46.0 million people, or 19. 8 percent
of the civilian noninstitutionalized population aged 18 years and older, received income-based government assistance through SSI,
SNAP, Medicaid, TANF . . . .”).
23 FINRA INVESTOR EDUC. FOUND., supra note 12, at 2–5; see Financial Literacy: Empowering Americans to Make Informed
Financial Decisions: Hearing Before the S. Subcomm. on Oversight of Gov’t Mgmt., the Fed. Workforce, & the D.C., Subcomm. of the
Comm. on Homeland Sec. & Governmental Affairs, 112th Cong. 79-94 (2011) [hereinafter Financial Literacy Hearing], available at