Why we should teach financial education in school
Few parents of students in elementary school, high school, or college would disagree if you said; we need to teach basic economics and financial education as mandatory parts of our education system and yet we don’t? Because? Well, that was the question that was recently posed in our think tank. What can we teach children?
How about balancing a checkbook, calculating simple interest and amortization, and how about personal budgeting and credit card debt problems? What about student loan offsets for college tuition? Is that a taboo? I’m sorry, but why not? Why should something be prohibited? Let’s talk, okay?
You see, one think tank guy agreed with me that he liked the principle and was surprised it wasn’t already part of the curriculum. Of course, he also told me that my ideas of ‘balancing a checkbook’ were a bit archaic; “Really? How many people still use checks? They haven’t written one in this decade.”
Okay, I recognize that point, still the principles of looking at a bank statement are valuable. Strangely, I’ve only written a handful of checks this year, now that I think about it.
Another couple of points: in the US we see 1.3 trillion dollars in outstanding tuition debt: 40% for 90 days in the rear, most of those students will default eventually, worse either way, they are financially enslaved as that debt cannot be paid off by bankruptcy, at least not yet, the democrats want to forgive and eventually give free college tuition, still those loans were recklessly taken.
Another challenge Car loans, zero interest, zero payments until next year, and loans to those with far below-standard credit, that’s another sign of poor decision making. What if those people had better knowledge about interest, loans and money?
When people took out ARMs during the run-up to the 2008 financial crisis, many said they didn’t understand what they were signing up for. Maybe they did, but they used it as an excuse, either way they should have known what they were signing up for and getting into.
Why are we in such a rush to financially enslave the next generation in debt? They come out of college and can’t buy a car, start a business or buy a house, how does that help move our economy forward? Something is wrong, and it’s something we can fix simply by teaching financial literacy, which is just as important to success in life as math, science, reading, and writing. Please consider this.