teach their children to effectively evaluate financial institutions and balance their bank accounts
because they lack the experience necessary to utilize those skills for themselves.
Another indication of the growing concern over financial illiteracy is the involvement of
the U.S. government in combating this issue, particularly over the last decade. 51 For example, the
Excellence in Education Act of 2001 vested in the Department of Education the ability to award
funds to nonprofit organizations focused on educating students in economics and personal
finance. 52 The Fair and Accurate Credit Transactions Act of 2003 (FACTA) 53 established the
Financial Literacy and Education Commission (FLEC), consisting of approximately twenty
federal agencies with existing financial education programs. 54 FLEC has since been active in
researching and developing solutions to the financial literacy problem. 55 Additionally, the
Financial Literacy and Education Improvement Act became Title V of the FACTA Act. 56
On January 29, 2010, President Obama signed an Executive Order creating the
President’s Advisory Council on Financial Capability. 57 This succeeded a similar council
established by President Bush in 2008 during The Great Recession. 58 FLEC provided easily
accessible methods to disseminate important finance information to the American public, such as
a website, MyMoney.gov, and a hotline, 1-888-MyMoney, as required under the Financial
Literacy and Education Improvement Act. 59 The Higher Education Opportunity Act sought to
provide financial education to student loan borrowers by requiring guaranty agencies to
implement classes and training tools targeted at improving financial literacy among student
borrowers and their families, primarily through the expansion of information services. 60 Though
the government has been active in this area, it is clear that more must be done. 61 At the very least,
the government needs to keep the momentum of change going and make educating youth a
priority. 62 If Congress ensured that children were provided a solid financial education via the
school system, perhaps America could end financial illiteracy once and for all. Providing a solid
financial education to America’s youth should go a long way towards reversing the trend of
growing financial illiteracy.
C. Why More Americans are Becoming Financially Illiterate
Why are more Americans financially illiterate than in previous years? The answer is
complicated. First, while the problem of financial illiteracy is growing due to the increasingly
complex matrix of financial products and its impact on the American economy is expanding, it is
51 PRESIDENT’S ADVISORY COUNCIL ON FIN. CAPABILITY, supra note 4, at 11 (“Supporting leadership, coordination and role clarity
among federal, tribal, state and local agencies on the issues of financial education, access and empowerment.”); see Exec. Order No.
13530, 75 Fed. Reg. 5481 (Jan. 29, 2010).
52 20 U.S.C.A. § 7267a (West 2013).
53 Fair and Accurate Credit Transactions Act of 2003, Pub. L. No. 108-159, Title V, 117 Stat. 1952.
54 20 U.S.C.A § 9702.
(a) IN GENERAL.—There is established a commission to be known as the ‘Financial Literacy and Education
(b) PURPOSE.—The Commission shall serve to improve the financial literacy and education of persons in the
United States through development of a national strategy to promote financial literacy and education.
Id. § 9702 (a)-(b).
55 See generally FIN. LITERACY & EDUC. COMM’N, supra note 25, at v-xv (laying out the Commission’s work over the last few years).
56 Fair and Accurate Credit Transactions Act of 2003, Pub. L. No. 108-159, Title V, 117 Stat. 1952.
57 Exec. Order No. 13530, 75 Fed. Reg. 5481 (Jan. 29, 2010) (creating the advisory council and subsequently terminating it on January
58 Exec. Order No. 13455, 73 Fed. Reg. 4445 (Jan. 22, 2008). The Great Recession will be examined in more detail below.
59 20 U.S.C.A. § 9703. The hotline number is available at Contact Us, MYMONEY.GOV, http://www.mymoney.gov/Pages/Contact-
Us.aspx (last visited Nov. 10, 2013).
60 Higher Education Opportunity Act, Pub. L. No. 110–315, §§ 110, 421-438, 122 Stat 3078, 3490 (2008).
61 See COUNCIL FOR ECON. EDUC., supra note 12.