Young Americans Financial Literacy Act

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Young Americans Financial Literacy 
Act''.

SEC. 2. FINDINGS.

    The Congress finds as follows:
            (1) Since 2007, there has been a nearly 20-percent drop in 
        the number of 18-year-olds with bank accounts, and in 2012, 
        nearly one in three Americans don't pay their bills on time.
            (2) Ninety percent of Americans believe all high school 
        students should be required to take a class in financial 
        education.
            (3) Eighty percent of parents believe schools are teaching 
        money management and budgeting, while over 70 percent of 
        teachers are not teaching financial literacy.
            (4) According to a 2010 survey, only a few States have 
        adopted varying degrees of financial literacy curriculum, and 
        only four States require high school students to take a 
        semester long course.
            (5) Two in five U.S. adults gave themselves a C, D or F on 
        their knowledge of personal finance. In 2011, 76 percent 
        admitted they could benefit from additional advice and answers 
        to everyday financial questions from a professional.
            (6) Two in five adults indicated that they are now saving 
        less than they were one year ago.
            (7) Most adults feel that their financial literacy skills 
        are inadequate, yet they do not rely on anyone else to handle 
        their finances; they feel it is important to know more but have 
        received no financial education.
            (8) It is necessary to respond immediately to the pressing 
        needs of individuals faced with the loss of their financial 
        stability, however increased attention must also be paid to 
        financial literacy education reform and long-term solutions to 
        prevent future personal financial disasters.
            (9) There is an urgent need to respond to the economic 
        recovery with research-based financial literacy education 
        programs to reach individuals at all ages and socioeconomic 
        levels, particularly those facing unique and challenging 
        financial situations, such as high school graduates entering 
        the workforce, soon-to-be and recent college graduates, young 
        families, and the unique needs of military personnel and their 
        families.
            (10) More than 70 percent of parents say they have spoken 
        with their teens about credit and using credit cards wisely, 
        while less than 44 percent of the teenaged children of those 
        respondents say their parents have talked to them about credit 
        cards.
            (11) Seventy-six percent of parents surveyed said their 
        high school student does not have a budget.
            (12) Seventy-five percent of 16 to 18-year-olds say 
        learning more about budgeting and money management is one of 
        their top priorities. Researchers document a ``snowball 
        effect'' that such early efforts exponentially increase the 
        likelihood that students will pursue more financial education 
        as time goes on.
            (13) High school and college students who are exposed to 
        cumulative financial education show an increase in financial 
        knowledge, which in turn drives increasingly responsible 
        behavior as they become young adults.
            (14) Sixty percent of parents identify their teens as 
        ``quick spenders'', and most acknowledge they could do a better 
        job of teaching and preparing kids for the financial challenges 
        of adulthood, including budgeting, saving, and investing.
            (15) Ninety-three percent of teens surveyed in a 2012 
        report say they are not involved in paying household bills or 
        managing the household budget. Forty-six percent admit to not 
        knowing how to create a budget.
            (16) The majority (52 percent) of young adults between the 
        ages of 23-28 consider ``making better choices about managing 
        money'' the single most important issue for individual 
        Americans to act on today.
            (17) According to the Government Accountability Office, 
        giving Americans the information they need to make effective 
        financial decisions can be key to their well-being and to the 
        country's economic health. The recent financial crisis, when 
        many borrowers failed to fully understand the risks associated 
        with certain financial products, underscored the need to 
        improve individuals' financial literacy and empower all 
        Americans to make informed financial decisions. This is 
        especially true for young people as they are earning their 
        first paychecks, securing student aid, and establishing their 
        financial independence. Therefore, focusing economic education 
        and financial literacy efforts and best practices for young 
        people between the ages of 8-24 is of utmost importance.

SEC. 3. AUTHORIZATION FOR FUNDING THE ESTABLISHMENT OF CENTERS OF 
              EXCELLENCE IN FINANCIAL LITERACY EDUCATION.

    (a) In General.--The Director of the Bureau of Consumer Financial 
Protection, in consultation with the Financial Literacy and Education 
Commission established under the Financial Literacy and Education 
Improvement Act, may make competitive grants to and enter into 
agreements with eligible institutions to establish centers of 
excellence to support research, development and planning, 
implementation, and evaluation of effective programs in financial 
literacy education for young people and families ages 8 through 24 
years old.
    (b) Authorized Activities.--Activities authorized to be funded by 
grants made under subsection (a) shall include the following:
            (1) Developing and implementing comprehensive research 
        based financial literacy education programs for young people--
                    (A) based on a set of core competencies and 
                concepts established by the Director, including goal 
                setting, planning, budgeting, managing money or 
                transactions, tools and structures, behaviors, 
                consequences, both long- and short-term savings, 
                managing debt and earnings; and
                    (B) which can be incorporated into educational 
                settings through existing academic content areas, 
                including materials that appropriately serve various 
                segments of at-risk populations, particularly minority 
                and disadvantaged individuals.
            (2) Designing instructional materials using evidence-based 
        content for young families and conducting related outreach 
        activities to address unique life situations and financial 
        pitfalls, including bankruptcy, foreclosure, credit card 
        misuse, and predatory lending.
            (3) Developing and supporting the delivery of professional 
        development programs in financial literacy education to assure 
        competence and accountability in the delivery system.
            (4) Improving access to, and dissemination of, financial 
        literacy information for young people and families.
            (5) Reducing student loan default rates by developing 
        programs to help individuals better understand how to manage 
        educational debt through sustained educational programs for 
        college students.
            (6) Conducting ongoing research and evaluation of financial 
        literacy education programs to assure learning of defined 
        skills and knowledge, and retention of learning.
            (7) Developing research-based assessment and accountability 
        of the appropriate applications of learning over short and long 
        terms to measure effectiveness of authorized activities.
    (c) Priority for Certain Applications.--The Director shall give a 
priority to applications that--
            (1) provide clear definitions of ``financial literacy'' and 
        ``financially literate'' to clarify educational outcomes;
            (2) establish parameters for identifying the types of 
        programs that most effectively reach young people and families 
        in unique life situations and financial pitfalls, including 
        bankruptcy, foreclosure, credit card misuse, and predatory 
        lending;
            (3) include content that is appropriate to age and 
        socioeconomic levels;
            (4) develop programs based on educational standards, 
        definitions, and research;
            (5) include individual goals of financial independence and 
        stability; and
            (6) establish professional development and delivery systems 
        using evidence-based practices.
    (d) Application and Evaluation Standards and Procedures; 
Distribution Criteria.--The Director shall establish application and 
evaluation standards and procedures, distribution criteria, and such 
other forms, standards, definitions, and procedures as the Director 
determines to be appropriate.
    (e) Limitation on Grant Amounts.--
            (1) In general.--The aggregate amount of grants made under 
        this section during any fiscal year may not exceed $55,000,000.
            (2) Termination.--No grants may be made under this section 
        after the end of fiscal year 2018.
    (f) Definitions.--For purposes of this Act the following 
definitions shall apply:
            (1) Director.--The term ``Director'' means the Director of 
        the Bureau of Consumer Financial Protection.
            (2) Eligible institution.--The term ``eligible 
        institution'' means a partnership of two or more of the 
        following:
                    (A) Institution of higher education.
                    (B) Local educational agency.
                    (C) A nonprofit agency, organization, or 
                association.
                    (D) A financial institution.
            (3) Institution of higher education.--The term 
        ``institution of higher education'' has the meaning given such 
        term in section 101 of the Higher Education Act of 1965 (20 
        U.S.C. 1001(a)).

Summary: Young Americans Financial Literacy Act Authorizes the Director of the Consumer Financial Protection Bureau to make competitive grants to, and enter agreements with, eligible institutions to establish centers of excellence to support research, development and planning, implementation, and evaluation of effective programs in financial literacy education for young people and families ages 8-24 years old. Limits the aggregate amount of grants made under this Act during any fiscal year. Sunsets the grant program at the end of FY2018. Defines quot, eligible institutionquot. As a partnership of two or more of the following: (1) an institution of higher education, (2) a local educational agency, (3) a nonprofit agency, organization, or association, or (4) a financial institution.