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Students around the world lack foundational literacy and numeracy (FLN) skills at striking rates. This essay examines the potential channels by which FLN investments and skills—which most systems teach in the early grades of primary school—may impact later schooling and subsequent life outcomes and the existing evidence for each channel. We find suggestive evidence for widening trajectories in school between students who master FLN skills in early grades and those who do not, although other factors may also explain the widening gaps. We find mixed evidence on the returns to FLN skills in earnings and other adult outcomes. We discuss new evidence from high-income countries suggesting that investments in pre-primary and early primary may not actually deliver the highest returns, and new evidence from low- and middle-income countries situating FLN investments among investments in other skills. We also discuss political obstacles to FLN investments. FLN skills are clearly essential for a growing, equitable society, but the distribution of investments in these and other skills—and the timing of those investments, in early primary or later in the course of an individual’s education—requires clear-eyed thinking about the relative returns of these investments and the challenges in their implementation.