Personal Finance
Here’s how this DC-area high school is helping to close the wealth gap
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Keith Harris, a 17-year-old high school senior at KIPP DC College Preparatory, has studied accounting, investing and budgeting, among other basic lessons, like his English, history and math curriculum.
Harris is enrolled in his high school’s NAF Academy of Business, a rigorous three-year finance program with a work-based learning component.
Because Harris, who lives with his aunt, received a full scholarship to college next fall, he’s also able to set some of his part-time earnings aside and invest those funds.
“Through the program I developed a lot of skills, such as managing my finances and investing in stocks,” Harris said. “It laid down a good foundation for me.”
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Unlike other one-semester high school personal finance courses across the country, more than 160 students enrolled in the KIPP DC College Preparatory’s NAF Academy of Business program study budgeting, saving, investing and managing risk, as well as other topics, right through graduation. Some receive NAFTrack certification, a credential that demonstrates a high standard of college and career readiness.
Many students also choose to enroll in the First Generation Investors program, where they can complete capstone projects while being tutored by students from Georgetown University’s McDonough School of Business.
Additionally, internship opportunities pair students with nearby employers, including Ernst & Young, the Navy Federal Credit Union and Verizon.
The program is paid for, in part, through federal and local funding and administered by the DC Office of the State Superintendent of Education.
The goal of the program, according to Shavar Jeffries, chief executive officer of the the non-profit KIPP Foundation, is “breaking cycles of poverty.”
KIPP DC College Prep caters to an underserved population of teens, and yet 100% of the senior class are accepted into at least one college, Jeffries noted, which is largely consistent with last year’s numbers.
“Economic security has to be a key part of it,” Jeffries said. “We have too many young people who don’t have the knowledge base to make smart financial decisions. When we can add that value and students bring these lessons home, that is also very powerful.”
Donyae Vaughan, 18, a senior at KIPP DC College Prep, will graduate this spring with a number of financial classes under her belt, including Accounting 1 and 2. She also landed a summer internship at consulting firm Accenture.
“Most people my age don’t get to learn about this stuff,” she said.
Vaughan, who has plans to attend dental school, said the coursework compliments what she has been taught at home. “My family is big on saving,” she said.
“Last year we learned a lot about investments, savings and stocks and how we can grow our money,” she said. “Every time I learn something new, I would go home and talk about it with my mom.”
Vaughan said she also learned about the merit of locking in a top-yielding certificate of deposit through the program.
A trend toward in-school finance classes
“The three years is a level of robust programming we don’t typically see,” said Raven Newberry, managing director of policy at the National Endowment for Financial Education.
As of 2024, about half of all states require or are in the process of requiring high school students to take at least one financial literacy course before they graduate, according to the latest data from Next Gen Personal Finance, a nonprofit focused on providing financial education to middle and high school students.
Although some schools and school districts have required students receive some financial education even without a state mandate, it is the schools that serve students from lower socio-economic backgrounds that tend to fall short in financial education offerings, according to Newberry.
“When a state requires it, that helps close that gap,” she said.
Financial literacy leads to financial wellbeing
In addition, a 2018 report by the Brookings Institution found that teenage financial literacy is positively correlated with asset accumulation and net worth by age 25.
Among adults, those with greater financial literacy find it easier to make ends meet in a typical month, are more likely to make loan payments in full and on time and less likely to be constrained by debt or be considered financially fragile.
They are also more likely to save and plan for retirement, according to data from the TIAA Institute-GFLEC Personal Finance Index based on research collected annually since 2017.
Pedestrians walk in front of the New York Stock Exchange, decorated with a giant U.S. flag, in New York City, Nov. 6, 2024.
China News Service | China News Service | Getty Images
Assets in U.S. exchange-traded funds in November topped $10 trillion for the first time, according to the latest data from Cerulli Associates.
ETFs — funds that invest in stocks, bonds or other assets and trade on national stock exchanges — reached $156 billion in flows for November, surpassing previous monthly flow records.
The activity is “on par with elevated activity typically seen toward the end of the year,” Cerulli reported.
Research from Morningstar pointed to a “Trump bump” that helped U.S. funds — including both ETFs and mutual funds — take in $115 billion in November, the highest total since April 2021.
As 2024 comes to a close, these are a few of the ETF trends that dominated the year, based on the latest data.
S&P 500 among 2024 fund winners
Year to date, the S&P 500 index is up almost 24%, as of Monday.
The S&P 500 rally, buoyed by the Magnificent Seven stocks — Apple, Microsoft, Google parent Alphabet, Amazon.com, Nvidia, Meta Platforms and Tesla — helped account for about half of the index’s gains for the year, according to data and analytics company VettaFi.
Four of the top 10 ETFs for 2024 by flows track the S&P 500 index, according to Cerulli.
The Vanguard 500 Index Fund ranks No. 1 for 2024 year-to-date inflows, according to Cerulli, followed by iShares Core S&P 500 ETF, iShares Bitcoin Trust, Invesco QQQ Trust, Vanguard Total Stock Market Index Fund, iShares Core US Aggregate Bond ETF, SPDR Portfolio S&P 500 ETF, Vanguard Total Bond Market Index Fund, Invesco S&P 500 Equal Weight ETF and Vanguard Growth Index Fund.
Malcolm Ethridge, a certified financial planner and founder and managing partner at Capital Area Planning Group, said he often uses S&P 500 ETFs in client portfolios because they allow for access to company names that would be in any large-cap growth strategy for significantly reduced costs.
While an actively managed fund may charge 50 or 75 basis points, a passive S&P 500 ETF may only charge 10 basis points, he said.
The S&P 500 index, which has had a record run, may be poised to continue to do well as the index rebalances to reflect current market leaders.
“I think this is a case where SPY [SPDR S&P 500 ETF Trust] probably outperforms the majority of fund managers in 2025,” Ethridge said.
Alternative ETFs see record growth
Meanwhile, alternative ETFs in November crossed $400 billion in net assets for the first time, according to Cerulli.
Moreover, the year-over-year asset growth rate for alternative ETFs — at 93% — was highest among all asset classes.
Most of the total alternative ETF market share — 80%, or around $325 billion — comprises digital assets, trading-leveraged equity and derivative income ETFs, according to Cerulli.
Financial advisors reported having just a 3.6% allocation to alternatives in 2024, though that is expected to increase, according to Cerulli. Within existing alternatives allocations, 14.4% is done through the use of ETFs, the firm found.
Crypto ETFs are ‘here to stay’
In January, bitcoin ETFs began trading on U.S. exchanges.
Now, spot bitcoin ETFs hold more digital currency than bitcoin founder Satoshi Nakamoto, VettaFi noted. Despite a “more lackluster” rollout for spot ethereum ETFs this year, crypto ETFs are “here to stay,” according to VettaFi.
The top five new ETFs by assets in 2024 are all bitcoin ETFs, according to Cerulli, based on data through November.
They include iShares Bitcoin Trust ETF at No. 1, followed by Fidelity Wise Origin Bitcoin ETF, ARK 21 Shares Bitcoin ETF, Bitwise Bitcoin ETF, and Grayscale Bitcoin Mini Trust ETF.
Janet Yellen, U.S. Treasury secretary, on a tour of the Financial Crimes Enforcement Network (FinCEN) in Vienna, Virginia, on Jan. 8, 2024.
Valerie Plesch/Bloomberg via Getty Images
An upcoming Treasury Department deadline for millions of small businesses to fulfill a new reporting requirement on “beneficial ownership information” was delayed again, following a court order that suspended enforcement.
The 5th U.S. Circuit Court of Appeals issued an order late on Dec. 26 that halted enforcement while the court “considers the parties’ weighty substantive arguments” on the constitutionality of the Corporate Transparency Act, which created the BOI reporting requirement, the order said.
The new deadline, which had been Jan. 13, is now unclear.
“While it is not known how long the injunction will remain in effect, the case is calendared for oral argument en banc on March 25, 2025, so we expect that the injunction will be effective at least through March,” Daniel Stipano, a partner at law firm Davis Polk & Wardwell, wrote in an e-mail.
In the interim, businesses aren’t required to file BOI reports to the Financial Crimes Enforcement Network, known as FinCEN, which is part of the Treasury.
Businesses don’t face liability for the time being
Additionally, businesses aren’t subject to liability if they don’t file BOI reports while the order remains in force, FinCEN wrote Friday on its website.
Businesses and owners that didn’t comply with the reporting rules were potentially subject to civil penalties of up to $591 a day. They could also face up to $10,000 in criminal fines and up to two years in prison.
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The BOI report data helps the federal government identify people who directly or indirectly own or control a company, to prevent criminals from hiding illicit activity conducted through shell companies or opaque ownership structures, Treasury said.
The rule applies to about 32.6 million businesses, including certain corporations, limited liability companies and others, according to federal estimates. Many are exempt from the requirement, such as businesses with more than $5 million in gross sales and more than 20 full-time employees.
“Reporting companies may continue to voluntarily submit beneficial ownership information reports,” according to FinCEN.
Whiplash for small businesses
The delay represents a bit of legal whiplash for small business owners.
On Dec. 3, a federal court in Texas temporarily blocked the Treasury from enforcing BOI reporting rules, which at that time were set to take effect Jan. 1, 2025.
Then, on Dec. 23, a motions panel of 5th Circuit lifted that enforcement injunction after an appeal from the federal government. On Dec. 26, a different panel of that same appeals court – the merits panel – put the injunction back into place.
“The bottom line is that no one needs to file a BOI Report – unless and until the injunction is lifted,” Stipano explained in an e-mail.
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