American Children Lack Basic Money Management Skills
If the United States is one of the richest countries in the world, why are there so many reports of people who have mismanaged their personal finances to self-destructive levels (Exhibit A: Big Spender: A Financial Intervention) ?
Many times I read the modest Business section of the Boston Globe and find something that leaves me wondering what the world will be like when my children are adults. Today's installment is in a Globe column by Steve Bailey: Teaching $ and sense.
Bailey is concerned (and rightly so) about what awaits young adults who were not required to take any personal financial management courses during their school years:
"Managing your finances -- your life -- isn't an optional skill today. We've moved into ``the ownership society," which roughly translates to: ``It's your problem, pal." Companies are not walking but running away from the historic pact they had with their employees. The closest most of today's students will come to an old-fashioned pension is to read about it in a history book."
Young adults today will probably not have a company pension or Social Security to provide for them in their old age. There is a strong need for them to learn how to save and invest at a young age so that they will the have some financial resources for the day when they cannot work due to age or illness.
Currently, the brunt of a child's financial education burden is placed with their parents. I can only imagine how many young people are learning poor money management skills by watching inept parents make one financial blunder after another.
I believe that a teenager who takes a personal financial management course along with English, math, and science would gain a lifetime of financial empowerment. Even a basic understanding of the following topics would make the next generation of Americans a financial force to be reckoned with:
Hopefully very motivated, since their future financial security depends on it.
Many times I read the modest Business section of the Boston Globe and find something that leaves me wondering what the world will be like when my children are adults. Today's installment is in a Globe column by Steve Bailey: Teaching $ and sense.
Bailey is concerned (and rightly so) about what awaits young adults who were not required to take any personal financial management courses during their school years:
"Managing your finances -- your life -- isn't an optional skill today. We've moved into ``the ownership society," which roughly translates to: ``It's your problem, pal." Companies are not walking but running away from the historic pact they had with their employees. The closest most of today's students will come to an old-fashioned pension is to read about it in a history book."
Young adults today will probably not have a company pension or Social Security to provide for them in their old age. There is a strong need for them to learn how to save and invest at a young age so that they will the have some financial resources for the day when they cannot work due to age or illness.
Currently, the brunt of a child's financial education burden is placed with their parents. I can only imagine how many young people are learning poor money management skills by watching inept parents make one financial blunder after another.
I believe that a teenager who takes a personal financial management course along with English, math, and science would gain a lifetime of financial empowerment. Even a basic understanding of the following topics would make the next generation of Americans a financial force to be reckoned with:
- Saving and living within one's means
- Balancing a checkbook
- Purchasing and financing homes and automobiles
- Maintaining a good credit score
- Understanding stocks, bonds, and mutual funds
- Saving for retirement with 401k's and Roth IRA's
- Using credit cards responsibly
Hopefully very motivated, since their future financial security depends on it.
posted by Frugal Frugalson at
9:37 AM
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