Question:
I teach high school. Although I am a science teacher, I assigned a personal finance project to my students. I was horrified to find out they didn’t know what loan terms were or in some cases what interest rates were…
Many objected to paying taxes, which I set at 30% for state, federal and Social Security combined. They didn’t understand that there were some bills they HAD to pay each month, and a few didn’t understand why they couldn’t get everything they wanted and just spend as much as they wanted each month, even if it was more money than they made.
My question: How do we teach kids these things — these kids are not learning at home — and in conversation, some of their parents may need the training, too. Are there (free- since K-12 schools have no money) programs to teach kids? I’m sure a program designed by a professional finance person would be better than the one I designed. Can you share you ideas what the kids need to know?
Thanks, Judi
Response:
Paddy Hirsch May 29, 2013 Senior Editor, Marketplace
Hi Judi Good question — you’re not alone in observing the deplorable state of personal financial awareness, and not just among students. It’s a common refrain in the personal finance advisory community, and a standard component of pitches for educational products. Of course, commentators such as Helaine Olen would argue that most of the personal finance educational products out there are either bunk or part of a plan to hook unsuspecting consumers into buying something they don’t need.
So the first thing I’d say to you is, beware of organizations pitching personal finance educational products! The chances are that your self-designed program is entirely adequate for teaching kids the basics of personal finance — I’m sure you’re quite money-smart enough to give advice on budgeting, saving, balancing a checkbook and the basics of money. But if you want more help, I’d suggest you go the nonprofit route. A good start might be to check out Operation Hope, to see if they offer or sponsor a program in your city. Good luck — and let us know how it goes!
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