Nobody used to talk about money. It was one of those topics that were kept quiet, inside the family and one not to discuss. Truth is that inside the family nobody was talking about it either. I know of many people who grew up with money but it was never discussed and they had no idea how to manage it or quite frankly balance a budget.
Times have changed. Many families with children have two working parents. Women are becoming the breadwinners. Some older women find themselves divorced or widows with zero understanding of their finances. People are working longer before having children and putting away cash for the future. I could go on and on but the importance of financial literacy is huge.
We have definitely talked to our kids about our finances because our finances will eventually be their finances. We consider our finances their finances. If it wasn’t for us, they would not have learned about budgets, costs of living, savings, stock, taxes, etc.
Someone made a really astute point at a dinner this past week the importance of teaching financial literacy in the school system and it should start when they are young. It is one thing to take an accounting class in college but it is another thing to create a curriculum around understanding your own finances. What you make, how much rent you can afford, how much you spend on clothes, how much to put into savings, how much to invest in the future, what are tax benefits of buying vs renting and above all by understanding all of this gives everyone control of their lives.
It might not be taught at school, yet, but as parents, you should be teaching your kids from early on how to manage their own money.
A financial history course should be a requirement to get a HS and college degree. It’s a tough topic to address at home but an essential one.
I agree that this is 100% important.Someone made a really astute point at a dinner this past week the importance of teaching financial literacy in the school system and it should start when they are young. There is no way I have faith in the school system to put together a curriculum that does this in the right way. I am sure there will be many super duper educators who get it right. But the vast majority will do about the same as they do with drugs and cigarettes. Do some half attempt that is a fail. And you know why that will be? Because they are not rated on success and it can’t be tested. By that I mean they can come up with tests to measure facts but those tests will not in any way be valid in real world situations (which requires seat of the pants experience). And of course getting into college isn’t based on these tests so they will lose motivation just on that to do a good job. Also, and this is important, teachers are typically unionized and have more or less secure and predictable employment (with pensions). They go on strike and get raises if they can. Their pay is not typically merit based. This does not represent the way it is for most people. So the education will be slanted toward something that has some security. Self employment or even working for a major corporation is not as secure today. How do you teach that? You won’t be able to. If you are self employed you have no clue what is coming down the pike in 2 or 10 years. Don’t let anyone tell you different.You learn about money by actually using money and needing money and making money. That is how you learn. Not be reading about it. Also by understanding human nature.
And as you said ‘as parents, you should be teaching your kids from early on how to manage their own money’. But most parents are not managing their own money right or making the right decisions with money.They are not you and they are not me. And also they are not the people that you associate with in NYC. No way. The woman who I was first engaged to years ago? Her parents (two teachers btw) were going to mortgage their house to pay for our wedding. How is that smart financially to do? Seriously.I recently rented an apartment to a woman who graduated in the hotel program at a major college. Her father, a financial planner and investor, got me to reduce the asking rent by telling me he would pay the whole year upfront. I told him just to give me post dated checks because I didn’t want to record all the income this year. So that is what he did.  (I would have given the same discount w/o him doing that as the apartment was overpriced to begin with!). Now he could have had his daughter do this (negotiate the discount to teach her) and honestly she actually could have afforded to pay the rent with her salary so why did he have to help her at all? What lesson does that teach her right out of college? It makes her dependent. After all she already knows that she has a safety net to fall back on. How is that learning? It isn’t. He also cosigned the lease (his idea) which I did not even require him to do. I saw who he was and I saw his daughter was respectable (I asked her for a video since I never met her) and decided it was a good risk based on that alone. I guess he had been reading articles on rent and got the area I am renting in confused with NYC and what is required there.
Agree completely. There is a similar movement in the UK, but I think we need to deal with numeracy first.
This is how I was raised. We would get a little bit for chores around the house, and then incentives to match other saving or activities which required initiative. One memory particularly stands out – I would help my dad write the checks for his monthly bills as a way to practice handwriting but also mark the ledger for the account.
That’s pretty cool
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My kids’ school does the 4th Grade Business Sale. They make a product and sell it. Have to budget for supplies and think about selling price. It’s a big “unit” in school and it very much gives them a sense of what goes into the “buy and sell” process. Even in 2nd grade, they do a unit on “marketplace” and understand how products go from the cacao bean to chocolate etc. They are taught about urban, rural and suburban areas and how the economies in these places may differ. This is our 2nd grader’s definition….of urban!!! https://uploads.disquscdn.c…