In an article published in The Chronicle of Higher Education titled Leveraging Admissions Tests to Increase Financial Savvy, Harvard Professor Peter Tufano (who was recently named the next dean of the University of Oxford’s Said Business School) makes a case for incorporating financially related questions into the SAT, PSAT and ACT exams. Citing the growing amount of student loan and credit card debt taken on by college students (the latter of which may be mitigated in part by the 2009 Credit Card Act), Tufano argues that students should be encouraged to develop financial literacy through test-related incentives. Tufano’s article suggests:
“For example, in the critical-reading section of the SAT, test takers are given passages—about the theater or population control, say—and asked what they mean. Those passages could be about credit cards, or insurance. In the math section, students solve word problems. Reframing some questions around key financial principles, such as interest compounding, would be straightforward. Testing services already have experience with this material, which is included in the GMAT, taken by M.B.A. applicants.”
Students would then seek out financial education while parents, schools, and test-prep companies would seek to provide it, all in an effort to boost test scores. Tufano also proposes including financial education in common curricular standards and requiring students to pass financial literacy courses before taking out loans.
The article concludes, “Teaching to the test is often criticized, but in this instance, harnessing self-interest may not only increase financial capabilities directly, but also stimulate bigger interventions to arm our youth to handle their complex financial lives.” NACAC’s Commission on the Use of Standardized Tests in Undergraduate Admission addressed issues related standardized testing and NACAC continues explore innovative approaches to admission tests. We invite you to comment on this idea—what do you think?
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