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In a bid to prepare high school students for managing money responsibly in the future, lawmakers have proposed a bipartisan bill. The bill, which is dubbed the PIGGY BANK act, would provide a cash benefit for high school students to encourage them to save. Find out more about this proposed bill and what it could mean for financial literacy and high school students below.
As of November 2021, the PIGGY BANK Act is a proposed piece of legislation or bill. Before any of its provisions may be implemented, it has to become a law. Bills become laws by being approved in both houses of Congress—the Senate and the House of Representatives—and being signed into law by the President.
The PIGGY BANK Act was introduced as legislation in the Senate in late September of 2021. That means it has a ways to go before becoming a law, if it becomes a law at all.
Any legislation introduced into the Senate or House of Representatives must be sponsored by a federal lawmaker. The Program to Inspire Growth and Guarantee Youth Budgeting Advice and Necessary Knowledge, or PIGGY BANK, Act was introduced by Gary Peters, a Democratic senator from Michigan, and Cynthia Lummis, a Republican senator from Wyoming. The senators are also working with organizations such as the National School Boards Association on the bill.
The fact that senators from both of the major political parties introduced the bill together means it has bipartisan support. That means lawmakers from both political parties may be willing to vote yes on it. While that doesn’t mean the bill will definitely pass, it sometimes does make it more likely.
The PIGGY BANK Act is being positioned as a financial literacy bill. The concept is that by providing high school students with the means to practice good money management as teenagers, the bill can help create more financially responsible future adults.
Here are some of the major provisions of the bill:
It’s important to remember that these are the major provisions of the bill as introduced in the Senate. Typically, bills may receive modifications as they go through the process, so it’s possible the House might propose its own version of the bill.
Perhaps one of the reasons this bill has bipartisan support is that most people can get behind the importance of financial literacy. Financial literacy refers to a person’s ability to understand personal financial matters and develop the skills to manage their own money responsibly.
Financial literacy is important for many reasons:
If the PIGGY BANK Act passes, parents can use it as a great teaching moment for their high school children. Encourage your child to participate by taking the required financial literacy class with them and providing ways for them to earn money they can save through the program.
Even if the PIGGY BANK Act doesn’t pass, parents can still teach financial responsibility and literacy in their own homes. You might go so far as to make a deal with your child similar to what the PIGGY BANK Act aims to do. Give them a certain amount to start a savings account and match some of their savings efforts through the years.
Here are some other tips for working with your kids on financial literacy:
While the PIGGY BANK Act is certainly an exciting piece of legislation for parents and high school students, you don’t need to wait for Congress to act before you can foster financial literacy. Consider setting up a savings account for your child today to get started.
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