Young Americans Financial Literacy Act
- Bill Number
- H.R. 486
- Origin Chamber
- House
- Congress
- 119th Congress, Session 1
- Policy Area
- Finance and Financial Sector
- Status
- Introduced
- Latest Action
- 2025-01-16: Referred to the Committee on Financial Services, and in addition to the Committee on Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- Last Updated
- 2026-04-14T08:05:39Z
AI-Generated Summary
Purpose of the Legislation
The Young Americans Financial Literacy Act aims to improve financial education for young people and families aged 8 through 24 by creating specialized centers focused on research, planning, implementation, and evaluation of effective financial literacy programs. It addresses gaps in current education systems, especially highlighted by economic challenges like the COVID-19 pandemic, to help individuals make better financial decisions and build long-term stability.
Key Provisions
- Grant Program Establishment: The Bureau of Consumer Financial Protection (CFPB, a federal agency that protects consumers from unfair financial practices) will award competitive grants to eligible partnerships (such as universities, government agencies, nonprofits, or banks) to set up "centers of excellence" in financial literacy education.
- Authorized Activities:
- Develop research-based programs teaching core skills like goal setting, budgeting, saving, managing debt, and understanding financial consequences, integrated into school subjects.
- Create materials and outreach for families facing issues like bankruptcy, foreclosure, credit card misuse, or predatory lending (unfair loans targeting vulnerable people).
- Provide teacher training to ensure quality delivery.
- Improve access to financial information and reduce student loan defaults through ongoing education.
- Conduct research and assessments to measure program effectiveness over time.
- Grant Priorities: Applications are favored if they define financial literacy clearly, target at-risk groups (e.g., minorities or low-income individuals), use evidence-based methods, include cultural sensitivities, promote savings and investments, and plan for long-term sustainability with shared data on results.
- Delivery Requirements: Programs must use accessible methods, including digital tools and social media, with user-friendly websites that avoid overwhelming users.
- Funding and Timeline: Annual grants total at least $27.5 million but no more than $55 million, starting immediately and ending after fiscal year 2029.
- Reporting: The CFPB Director must submit yearly reports to Congress listing grant recipients, amounts, and the populations served.
- Definitions: Eligible institutions are partnerships of at least two entities (e.g., colleges, nonprofits); "institution of higher education" refers to accredited colleges or universities under federal law.
Significant Changes to Existing Law
This bill amends the Consumer Financial Protection Act of 2010 (part of the Dodd-Frank Act, which reformed financial regulations after the 2008 crisis) by adding a new section (1037) authorizing these grants and redesignating an existing section (1037 to 1038). It introduces a dedicated funding mechanism for youth-focused financial education, which was not previously specified, while requiring consultation with the Financial Literacy and Education Commission (a federal advisory group).
Potential Impacts
- On Government Agencies: The CFPB will manage grants, evaluations, and reporting, potentially increasing its role in education without new regulatory powers. It may collaborate more with the Department of Education.
- On Citizens: Young people and families (especially ages 8-24) could gain better skills to avoid financial pitfalls, leading to improved personal finances, lower debt defaults, and greater economic independence. At-risk groups may benefit from tailored programs, fostering broader economic recovery post-crises like COVID-19.
- On International Relations: Minimal direct impact, as this is a domestic education initiative focused on U.S. consumers.
Main Stakeholders Affected
- Young People and Families (Ages 8-24): Primary beneficiaries, including students, recent graduates, young parents, and military families, who gain access to financial education.
- Educational Institutions and Nonprofits: Universities, schools, and organizations receiving grants to develop and deliver programs.
- Government Entities: CFPB (grant administrator), state/local agencies (partners), and the Financial Literacy and Education Commission (advisory role).
- Financial Sector: Banks and institutions partnering in programs, potentially improving consumer trust and reducing risky behaviors like predatory lending.
- Educators and Teachers: Benefit from training to integrate financial topics into curricula.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens consumer protection laws by embedding education into financial regulation, with clear standards for grant use to ensure accountability. No enforcement penalties are added, focusing instead on voluntary programs.
- Constitutional: Aligns with Congress's power to spend on education and welfare (under the Spending Clause), promoting general welfare without infringing on free speech or state education rights, as grants are competitive and non-mandatory.
- Political: Supported by a bipartisan group of lawmakers, it reflects consensus on addressing financial literacy gaps amid economic stress. The time-limited funding (ending 2029) allows for evaluation before potential expansion, but it may spark debates on federal involvement in school curricula versus state control.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Cosponsors (49)
Rep. Amo, Gabe [D-RI-1], Rep. Barragán, Nanette Diaz [D-CA-44], Rep. Brown, Shontel M. [D-OH-11], Rep. Carter, Troy A. [D-LA-2], Rep. Case, Ed [D-HI-1], Rep. Casten, Sean [D-IL-6], Rep. Cohen, Steve [D-TN-9], Rep. Dean, Madeleine [D-PA-4], Rep. Espaillat, Adriano [D-NY-13], Rep. Evans, Dwight [D-PA-3], Rep. Hayes, Jahana [D-CT-5], Del. Norton, Eleanor Holmes [D-DC], Rep. Johnson, Henry C. "Hank" [D-GA-4], Rep. Magaziner, Seth [D-RI-2], Rep. McGovern, James P. [D-MA-2], Rep. McIver, LaMonica [D-NJ-10], Rep. Ramirez, Delia C. [D-IL-3], Rep. Sánchez, Linda T. [D-CA-38], Rep. Scholten, Hillary J. [D-MI-3], Rep. Soto, Darren [D-FL-9], Rep. Thanedar, Shri [D-MI-13], Rep. Titus, Dina [D-NV-1], Rep. Torres, Ritchie [D-NY-15], Rep. Omar, Ilhan [D-MN-5], Rep. Watson Coleman, Bonnie [D-NJ-12], Rep. Beatty, Joyce [D-OH-3], Rep. Keating, William R. [D-MA-9], Rep. Davis, Donald G. [D-NC-1], Rep. Olszewski, Johnny [D-MD-2], Rep. Mfume, Kweisi [D-MD-7], Rep. Thompson, Bennie G. [D-MS-2], Rep. Smith, Adam [D-WA-9], Rep. Veasey, Marc A. [D-TX-33], Rep. Mullin, Kevin [D-CA-15], Rep. Horsford, Steven [D-NV-4], Rep. Carbajal, Salud O. [D-CA-24], Rep. Tokuda, Jill N. [D-HI-2], Rep. García, Jesús G. "Chuy" [D-IL-4], Rep. Tlaib, Rashida [D-MI-12], Rep. Wilson, Frederica S. [D-FL-24], Rep. Escobar, Veronica [D-TX-16], Rep. Figures, Shomari [D-AL-2], Rep. Clarke, Yvette D. [D-NY-9], Rep. Cherfilus-McCormick, Sheila [D-FL-20], Rep. McBride, Sarah [D-DE-At Large], Rep. Lieu, Ted [D-CA-36], Rep. Johnson, Julie [D-TX-32], Rep. Craig, Angie [D-MN-2], Rep. Bonamici, Suzanne [D-OR-1]
Recent Actions
- 2025-01-16: Referred to the Committee on Financial Services, and in addition to the Committee on Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-01-16: Referred to the Committee on Financial Services, and in addition to the Committee on Education and Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
- 2025-01-16: Introduced in House
- 2025-01-16: Sponsor introductory remarks on measure. (CR E40)
- 2025-01-16: Introduced in House
Bill Versions
- Young Americans Financial Literacy Act — issued 2025-01-16 — PDF (11 pages)