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Teaching High School Kids About Personal Finance
By JLP | April 19, 2007
Check out this article, Teaching Life Lessons in Dollars and Sense. Sadly, although these finance classes will help some, most kids are learning (or not learning) about personal finance at home:
Though some parents do a good job teaching their kids, some live paycheck to paycheck and kids follow suit, says Whitefield. They get jobs at younger ages to earn money that they spend without giving a thought to money management. “They’ll get a checking account before they get a savings account. I think that’s a little backward,” she says.
The really sad thing is that it’s not that hard to start off on the right foot. On the other hand, if you start off by making mistakes, those mistakes have a way of compounding on each other.
The article also talks about Utah’s financial literacy program for high school Juniors and Seniors, complete with resources for teachers and resources for students and parents. It’s nice to see some proactivity!
Topics: Kids and Money | 9 Comments »
April 19th, 2007 at 1:02 pm
Several years ago, I had the pleasure of volunteering to teach a high school course in finanical literacy as part of the Junior Achievement Program. The high school (in NYC) was primarily serving an economically disadvantaged community – the kind of place where one of the kids in class had miraculously survived being gunned down in the vestibule of his housing project just for being in the wrong place at the wrong time. Even though I grew up in that kind of environment, I’ve been a long way from Kansas (so to speak) for a long time, so it was quite the eye-opener.
We ended up straying from the usual “how to start a business” coursebook stuff and into a lot of workplace and personal finance topics. I literally rolled up my sleeves when I walked into the classroom and we sat around and talked about their real concerns about the future – what to do after high school, how to pay for college or trade school, how to get a job, how to buy a car, how to rent an apt, etc. Nobody had really talked to them about money before – about the real cost of adulthood – they were utterly shocked to learn how much of their future paychecks would be going to Uncle Sam. I asked them to talk about their wants – and then I asked them how much they thought those wants might cost – and then I asked them how much they thought they’d need to make to pay for those wants.
In talking about how businesses work, we also talked about how your financial life is really like a small business. In that way, they got to learn something about both.
I think a few of them came away at least realizing that some their assumptions about how to get by financially after high school might not make good long-term strategies.
It was just a 1 1/2 hour per week gig for 10 weeks, but it was one of the most interesting volunteer activities I’ve ever participated in.
April 19th, 2007 at 3:15 pm
I disagree that if kids make mistakes then they’ll compound. I had jobs and I spent all my money, but in the end I learned because I made mistakes. Who doesn’t know they should save for a rainy day? Probably the same people who don’t know smoking is bad for you. The worst kids are those who are spoiled, because they never have to work for a dime and still get whatever they want, so they never understand anything of trade-offs or thinking ahead.
April 19th, 2007 at 4:27 pm
@Revenge – I have to completely and utterly disagree. And I am like you, somebody who made lots of mistakes and eventually learned from my mistakes. And so I can well understand how it would be difficult for somebody coming from your view to understand why people will keep screwing up despite the obvious clarity of their situation.
But, I’ve seen it too often in my family and friends. Early mistakes that go unchecked, usually end up being life-long habits for people who do not have the kind of self-balancing mechanism that you do. And truth be told, the turning point for me was really in meeting my frugal-minded, save-for-a-rainy-day wife, who beat some common sense into my thick living paycheck-to-paycheck brain. If I had married a self-reinforcing spender like myself, chances are I would still be in hock up to my eyeballs in debt.
April 20th, 2007 at 6:28 am
Weekly Roundup – 04/20/07
Here’s a quick look at some of the articles that caught my eye over the past week…
FMF asks if going to grad school is a financial mistake.
JLP talks about teaching high school kids about personal finance.
Flexo broke down his 401(k) stat…
April 20th, 2007 at 10:06 am
My parents started to teach me about money the first time I got an allowance. My allowance started at $1 a week (early 80’s, that bought candy) and from every dollar I was expected to tithe 10% and save 25%, so I only ended up with $.65 in my pocket. When I negotiated a higher allowance of $2 a week, the percentages didn’t change.
In high school, my parents didn’t have a lot of money, but they helped my brother and I with our dog business (we raised toy poodles). We got to use that money for luxaries, but we had to work for it.
April 21st, 2007 at 4:08 am
In reference to your article about “Teaching your children” Just buy them a copy of “The Insider’s Guide to Saving Money” by Michael Ellenbogen. It covers all sorts of topics about saving money, banking, travel, insurance, customer service issues, how to search the internet, dining, real estate, buying items cheap, automobile tips and many more. I’m telling you this book covers everything. It’s easy to learn. I would say it’s for someone who is about 15 years and older. I learned a lot from the book and I am over 40.
http://www.michaelellenbogen.com
April 26th, 2007 at 4:25 pm
Thanks for the link to the Utah program. I can’t wait to check out their resources. Another group you may find interesting is the National Endowment for Financial Education (http://www.nefe.org/).
June 14th, 2008 at 12:32 am
I grew up in a low income household – living paycheck to paycheck. I got my first job at age 12, I developed a good work ethic, and I learned the value of money. My children will be in a more ‘privileged’ position than I was when I was their age, but I gaurantee that I will work to teach them the same principles I learned. To do otherwise would be a great disservice to them.
February 8th, 2009 at 1:57 pm
There is a book that is making so big waves its called “On My Own Two Feet” a girl’s guide to personal finance. It is direct, concise, and extremely eye-opening- informative. Throw away the fact it said “girls guide”, I’m a guy and it hit on many key point that made me financially secure. What’s better! is how it points out the hidden traps that are setup by loans and credit cards. The ones that the average person doesn’t know. “On My Own Two Feet” a girl’s guide to personal finance I goot a borders for $12 Amazon has it for $11.00 and you don’t have to take my word for its( LOL like reading rainbow) check out there reviews.