Does our society have enough financial education?

[WaterIsland]

At least in the US, it seems like there is not enough financial education. Although kids are taught reading, writing, math, science, history, etc. Financial education is lacking. Kids aren’t really taught how to make a budget, file taxes, interview for jobs, how to invest, or save for retirement, how loans, debt and credit cards work.

These are all important skills that it really feels like our society doesn’t teach kids enough. Which can become a contributing factor in financial hardship later in life.

What do you think? Do we have enough financial education?

Yes

No

[BeMuse]

When I went to public school in Florida civic and economic literacy was part of the basic education curriculum. One of the required courses covered America politics for half of the course and economics for the other half of the course. In the economic portion we had to learn about banks/calculating simple and compound interest, amortizing a loans, retirement account types and tax benefits, paying taxes, etc. We had to run a multi-month simulation to manage our own company in groups competing against other companies in our classroom and against other companies in different class periods. This included budgeting for our company, capital investments, marketing budgets, etc. we planned out how much we wanted to spend on all the various variables each cycle based on what we had learned about micoeconomics in the course. This was then put into a computer with every other competing corporation and then sales results were output at the end of each week. Then we had to adjust to market forces and adapt our plan. I remember winning that competition and earning an award at graduation. I also came in third place in a stock investment game on yahoo that year. I was only beat by two wall street traders.

In another high school course I took I remember learning about various job fields, having to assemble a resume in class properly based on our current skills and work experience. This lead to do mock interviews with the teacher and a guest who was a volunteer businessman from the community. We interviewed for fictitious job positions at high school levels, but there were asked additional questions about where we planned to be in 5 years and what education goals we had to obtain those goals to motivate us to go onto college.

I also remember taking OJT (On Job Training) where we got out of school early to go work at our High School jobs in the community as an elective in senior year. We had to log our hours in our OJT class every week that we worked, what we earned, what taxes we were paying, etc. Our OJT teacher followed up with our employer to see if we were doing a good job. There were education topics to help us file our tax returns for the jobs we were currently working. We covered more economic topics. We had to learn how to incorporate a business in the state of Florida, file with IRS for a subchapter S, file for an Employer Identification Number (EIN), get a sales tax ID, file for a business license in Palm Beach County, we talked about setting up business bank accounts, building corporate credit, corporate tax structures, tax deductions, and so on.

I think public school in Florida, specifically in Boca Raton provided plenty of financial literacy education to students. That said I thought it was all pretty basic at the time, but I grew up in a very financially literate household with parents that owned their own businesses. My dad was running an accounting firm. My mom was handling estate planning/trusts, real estate, taxes, etc. I had bank accounts since I was 5 years old. I had invested in the stock market since I was like 13 years old back when you had to go to the library to look up stocks and calculate dividends by hand. I had run a neighborhood small business and employed a number of my friends. I started my first corporation at 17 years old. So, I didn’t really think I was learning anything new, but they definitely covered the basics in High School for anyone that wanted to learn.

[WaterIsland]

Crazy. Yeah my school didn’t have any of that.

[richardcory]

We don't, but of course the question in education is if you want to add a course, what do you remove.

I think learning about finance, and learning about jobs - what career paths are like, how to apply for a job, etc would be really valuable.

[WaterIsland]

Agreed. However, does it have to be remove? Couldn’t it just be shorten or change? Especially in the later years of high school, is the reading, writing, and science classes you take truly apply to everyone? I’d argue no. It’s important in earlier years, sure. But in the later years, it becomes less applicable except for certain careers. Financial education and career planning would be far more useful than the latter years of those other traditional classes.

[richardcory]

Yes, we could shorten other classes.
I feel like COVID has shown that we need more science and math not less. I was really depressed to discover that for most Americans (including news casters) "exponential" means "big". It doesn't, it describes the math behind how (for example) disease spreads and understanding it is vital to knowing how to stop it.

I could see dropping a lot of literature, but maybe need more classes on how to verify facts in the world of online information. Maybe also a bit on how the scientific method and science actually work.

Of course I'd also like more govt classes. How many people even know what the Federal Reserve does - yet they are voting based on inflation.

[WaterIsland]

Great points. Especially in regards to verifying online information. I remember teachers just saying “Wikipedia isn’t a reliable source”. Which, sure. But Wikipedia can be an incredible starting point if you actually dig into the sources and references listed. Additionally, Wikipedia isn’t the only source that isn’t always reliable. But that point was kinda glossed over.

And in regards to the Federal Reserve. These days you can learn more from a 10-15 minute YouTube video than schools ever teach students. Which is pretty sad.

[richardcory]

Agree. I see the lack of reliable information to be a huge risk to society. Many problems - economy, climate, covid, etc are very complex. Its just not possible for people to do their own research, or even to read the research papers. (the climate IPCC report is over a thousand pages, and its a summary of a huge number of papers). So the public has no choice but to rely on summaries of the science. But which summary to trust?

[Anonymous]

Yes. Society has the amount of financial education its supposed too. Schools job is to get kids ready for monotonous jobs in an office or factory working for minimum wage. You think the powers that be want kids to learn about saving their money, budgeting, not buy things on credit, not running up huge debts not buying everything on credit, not living paycheck to paycheck, buying their own home. The more ignorant people are the easier it is to take advantage of them and separate them from their money.

[LazerBean]

No, but that is the fault of parents. Kids are all pretty spinning in a certain amount of time being taught by the government, are we supposed to add more time? If parents actually start teaching their kids stuff instead of expecting the government to teach their kids everything, this world would be a much better place.

[WaterIsland]

I do agree with this. However, it can lead to a vicious cycle. If the parents weren’t taught solid financial principles, how can they be expected to teach their kids? I wish the solution was as easy as parents doing a better job. But I’m skeptical that is the silver bullet.

[LazerBean]

The answer is that the cycle would never have started in the first place if parents never gave up their parental responsibilities to the government.

[BCA6010]

Definitely not.

The oversimplified solution is to cut out the "college prep" focus of schools, and incorporate practical subjects such as the ones you've listed.

I took a budgeting class as an elective in high school, and it's probably the only class from senior year I actually learned anything useful.

[NathanDavis]

we have lazy parenting... more than anything else

[Anonymous]

Yeah, it exists
Just extra-curricular rather than through the indoctrinated liberal 'education' system

[WaterIsland]

Just because it exists as extra-curricular, doesn’t mean it’s “enough”.

[Opinion Owner]

Anyone with the internet can get more than enough education if they are determined to seek it

[WaterIsland]

Under that logic, all schools are meaningless. Is that the argument you’re making?

[Opinion Owner]

Didn't learn that much in school after the first few years