Too many students leave high school with a diploma in hand but no clue how to build a budget, grow credit, or plan for the future. An overwhelming 88% of U.S. adults say high school didn’t fully prepare them to handle money in the real world.
That’s where financial literacy can come to the rescue. It bridges the often-too-wide gap between classroom theory and everyday reality, equipping students with practical skills they can put to use right away and rely on for years to come. Whether they’re cashing their first paycheck, buying a car, or applying for a credit card, financially literate students are empowered to make smart choices and take charge of their financial futures.
Where should educators begin?
This seven-part framework turns financial education into something students can actually use—rather than just study to be quizzed on. Each piece builds on the last, helping students form smart money habits and connect what they’re learning in class to their own goals and dreams.
It’s also the backbone of the P2C Financial Literacy Curriculum. Developed in partnership with the American Public Education Foundation (APEF) and aligned with the National Standards for Personal Financial Education, the interactive curriculum is made up of 86 highly engaging lessons that equip students with essential financial skills for life beyond high school.
The 7-Part Financial Literacy Framework
1. Earn
Teach students how to generate income and increase their earning potential.
This component helps students connect the dots between what they’re learning today, what skills they’ll continue to develop, and how much income they have the potential to earn in both the near and far future.
Educators should help students explore the different ways people make money—from paychecks to side hustles to investment returns—along with how each is taxed. Starting here will give learners an eye-opening look at how effort, planning, and choices shape financial outcomes.
Key Concepts:
- The relationship between education, skills, and wages
- Goal setting and how it influences lifetime earnings
- Strategies for job searching and negotiating salaries
- The importance of continuous learning and personal development
- Creating a budget and managing multiple income streams
- The different types of income (earned, passive, and portfolio) and the tax implications of each
2. Plan
Empower students to set financial goals and make informed money decisions.
As with any type of planning, strong financial planning leads to stronger outcomes. Help students learn how to evaluate opportunity costs, set priorities, and create a personalized roadmap to reach their financial goals—whether that means buying a car, saving for college, or even retiring comfortably someday.
Key concepts:
- Opportunity costs and trade-offs
- Adjusting plans to accommodate life changes or setbacks
- Prioritizing financial needs based on goals and values
- Setting SMART (Specific, Measurable, Achievable, Relevant, Time-bound) financial goals
- Creating step-by-step plans for big milestones, like paying off debt, buying a home, and saving for retirement
3. Save
Encourage students to build a financial safety net.
Saving money is not as simple as adding coins to a piggy bank or cash to a wallet. This component teaches the value of delayed gratification, intentional spending, and building habits that support long-term security.
Key concepts:
- The benefits of saving, such as reducing financial stress, building wealth, and achieving financial freedom
- The importance of delayed gratification
- Creating emergency funds and building a financial safety net
- Retirement savings options
- Developing a budget that includes savings as a priority
4. Invest
Introduce long-term strategies for building wealth.
Help students explore investment options and learn how to make informed decisions that will grow their money over time. This component helps learners understand risk and reward, the power of compounding, and the benefits of diversification.
Key concepts:
- Types of investments, including stocks, bonds, mutual funds, and ETFs
- Selecting investments that align with one’s risk tolerance, financial goals, and values
- The importance of diversification and compounding returns
- Portfolio building and monitoring
- Staying ahead of inflation
5. Spend
Promote smart, values-driven decision-making.
Spending wisely is about aligning money choices with personal priorities. Emphasize key skills for living and spending independently: distinguishing needs from wants, avoiding impulsive purchases, and planning within a budget.
Key concepts:
- Budgeting on a limited income, including tracking expenses
- Understanding how advertising, social media, and peer influence affect spending habits
- Understanding the true cost of ownership, by factoring in maintenance, subscriptions, and hidden fees
- Distinguishing between essential and non-essential expenses
- Understanding the potential risks and consequences of overspending
6. Borrow
Help students understand how to use credit responsibly and manage debt.
Many students will face big decisions about borrowing soon after they graduate high school, if not before. They need to be prepared to navigate student loans, credit cards, car loans, and more.
This component demystifies debt, interest, and credit scores, helping students make smart borrowing decisions.
Key concepts:
- Different loan types, including student, auto, and credit card loans, and how repayment terms vary
- Evaluating loan offers by comparing interest rates, fees, and total repayment costs
- Maintaining a healthy credit score and understanding what affects it
- Recognizing predatory lending practices and how to avoid high-risk borrowing
- Reviewing loan or credit card statements and creating a realistic debt repayment plan
7. Risk
Prepare students to handle financial risks and unexpected costs.
As students may already know, life is full of uncertainties. This final component teaches them how to plan for the unexpected, through insurance, emergency savings, fraud prevention, and other savvy strategies. It also builds awareness of broader financial risks, such as inflation and market volatility.
Key concepts:
- Types of financial risk, including market, credit, inflation, and unexpected emergencies
- Insurance essentials, including how premiums, deductibles, and coverage types work
- Building and maintaining an emergency fund to cushion against sudden expenses
- Identity theft and fraud prevention, including online safety and scam awareness
- Creating a basic risk management plan that includes savings, insurance, and smart decision-making’
Bringing it All Together
The seven components outlined here offer a practical, powerful framework for helping students make informed, confident financial decisions—both now and in the future. With the right tools and support, financial literacy becomes more than just another subject on their report card; it becomes a lifelong skillset. Students gain the ability to assess salaries, benefits, student loans, and budgeting strategies through the lens of their personal goals and career aspirations.
Want a quick, classroom-ready summary of these concepts?
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