The Cost of K-12 Education: States That Invest the Most in Their High School Graduates

ByDeb Gordon

Updated: December 26, 2023

ByDeb Gordon

Updated: December 26, 2023

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The COVID-19 public health crisis laid bare just how critical public schools are in American life. The pandemic made clear that many K-12 schools offer more than classroom learning alone; many also provide social and emotional support, health and wellness services and basic preparation for life beyond school.

High school graduates contribute to local economies and society at large, reducing the burden on the social safety net and contributing to the tax base that fuels public services. Higher earners can more easily qualify for lower-cost credit and avoid excessive debt.

Producing high school graduates requires substantial investment. Overall, state and local governments spend 18% of their budgets on elementary and secondary education — double what they spend on health care and hospitals.

Knowing the benefits of graduating high school, MoneyGeek analyzed state and local spending compared to the number of high school graduates in every state to understand how costly it is to create a graduate. Nationally, it costs an average of $208,000 per high school graduate. To put these investments into context, we looked at other measures of educational effectiveness, such as the percent of students who take the SAT or ACT and how students perform on those tests.

At MoneyGeek, we believe teaching kids about personal finance can help people achieve financial security at any age, so we also looked at the percent of students who get personal finance education.


The Value of a High School Diploma

A high school diploma is considered the bare minimum for many jobs in the United States. And it pays to get one: high school graduates earn an average of 26% more than people who don’t finish high school. Higher earnings, in turn, translate into higher tax payments, which fund public services and the social safety net. High school graduates also cost society less. According to RAND Corporation, high school graduates use fewer public services — such as government-sponsored health insurance — and commit fewer crimes. Benefits to society include lower incarceration costs and better safety in communities. But not all high school degrees are equally valuable. Analysis from the Center for American Progress showed students in every state have preparation gaps that can impact student readiness for college and life beyond high school more generally.

What Does It Cost To Produce a Graduate?

Our analysis of cost per graduate indicates a wide range of costs, with a high of $338,000 in New York to a low of $131,000 in Idaho. Each state’s costs were adjusted for their relative purchasing power to reflect the cost of living differences for each state. For example, the true cost of a high school graduate in New York is $394,000 without those adjustments.

10 States with the Highest Cost Per Graduate


10 States with the Lowest Cost Per Graduate


Does Higher Investment Yield Better Test Scores?

To understand if states that spend more per graduate better prepare their graduates, we reviewed spending relative to college test scores. Though test scores are an imperfect measure of education quality, we used it as a proxy because it is a consistent, comparable measure. We found no correlation between either the ACT or SAT scores and costs. The chart below shows the cost per graduate in relation to SAT scores.


We also analyzed the cost per graduate relative to graduation rates. Higher dropout rates could drive higher costs per graduate because school system costs include students who don’t graduate. However, there was no correlation between graduation rates and costs per graduate. As an example, Arizona has the second-lowest graduation rates and the second-lowest cost per graduate.

Personal Finance Education Ranking

We created a financial literacy score to reflect the percentage of students receiving high-quality financial education. Four states — Missouri, Tennessee, Alabama and Utah — earned 100 on financial literacy, driven by state educational requirements, and Virginia scored 98 out of 100. In these states, virtually all students get the curriculum that meets the top teaching standards for financial education. Sadly, the scores drop precipitously after these top spots. Across the states, the national average score is 34 out of 100 with most students receiving financial literacy in their schools, but not a significant proportion receiving the highest standards.


Full Data Set

MoneyGeek’s analysis is ordered by cost per high school graduate.

  • Cost Per Graduate: The cost per high school graduate in thousands of dollars adjusted for purchasing power in each state.
  • Graduation Rate: The public high school four-year adjusted cohort graduation rate (ACGR)
  • K-12 Spending: Total spending on primary and secondary education in the state inclusive of state and local spending
  • K-12 Spending % of Expenditures: K-12 spending as a percent of total government expenditures in the state.
  • College Test Completion Rank: Weighted score from 0 to 100 reflecting the proportion of students taking either the ACT or SAT. Where states score 100, this reflects state-mandated testing.
  • Personal Finance Education Rank: Scoring from 0 to 100 reflecting the population-weighted quality of personal finance education in the state.


MoneyGeek calculated the cost for each state to produce a high school graduate by analyzing state government spending provided by the U.S. Census and adjusted these figures based on data accessed via the U.S. Bureau of Economic Analysis to account for the cost of living differences in each state.

We also reviewed the graduation rates for public high schools in each state and analyzed data on standardized test-taking and results to determine if spend per graduate impacted testing outcomes. This data was courtesy of the NCES.

Financial Literacy Score: This score is calculated based on Next Gen Personal Finance’s analysis of the proportion of students in each state getting different standards of personal finance education. NGPF uses four levels in their teaching standards: gold, silver, bronze and none. A numerical weight was assigned to each of these standards to calculate a score for each state based on the proportion of the student population getting an education in personal finance.

About Deb Gordon

Deb Gordon headshot

Deb Gordon is the co-founder and CEO of Umbra Health Advocacy, and author of The Health Care Consumer’s Manifesto (Praeger 2020), a book about shopping for health care based on consumer research she conducted as a senior fellow in the Harvard Kennedy School’s Mossavar-Rahmani Center for Business and Government between 2017 and 2019. Her research and writing have been published in JAMA Network Open, the Harvard Business Review blog, USA Today, RealClear Politics, TheHill, and Managed Care Magazine.

Deb previously held executive roles in health insurance and health care technology services. Deb is an Aspen Institute Health Innovators Fellow and an Eisenhower Fellow, for which she traveled to Australia, New Zealand and Singapore to explore the role of consumers in high-performing health systems. She was a 2011 Boston Business Journal 40-under-40 honoree, and a volunteer in MIT’s Delta V start-up accelerator, the Fierce Healthcare Innovation Awards and in various mentorship programs.