Today’s article is “Teaching Young People about Personal Finance“
Brief summary: Financial literacy organizations aim to teach young people about finance and credit before they get into debt.
We hear in the news that times are tough. Depending on where we live around the country we may even be experiencing some of the pain first hand. And while there are some out there doing a lot better than the news would lead you to believe, there are others that are going through nothing less than their own personal, financial apocalypse.
Unfortunately, by the time someone’s financial problems make the news, it’s probably too late for them to spare themselves some pain through personal finance education. They are already enrolled in the school of hard knocks.
So what happened? We all know that grandma’s way of handling money was quite different that what we see from the jet-setting, prime-time TV show characters (and, dare I say, reality TV stars?). When did we lose the “use what you have, live within your means, and pay with cash” principals our parents were raised on? We really are victims of our parent’s success. For two generations, since the Great Depression, times have been really good. Unfortunately, we all got caught up in the excitement of flush times, never thinking they would end, and made the critical mistake of forgetting something- to hold a little something back in case the good times ended. However, in all likelihood there was never a friend or loved one standing there beside us, congratulating us on our successes while gently reminding us that we should save… just in case. We certainly didn’t get that from TV, news, movies, magazines, or even the government!
The message has been that we need to increase “consumer spending” to keep the good times rolling. The government encouraged universal home ownership, and while we all want everyone to have a good, safe home, we all know that not everyone is cut out to be a home owner. In one sense the sub-prime crisis facing the global financial system can be considered the result of a failed government policy to combat homelessness (or maybe just renters…). Another take is that the evil banks took advantage of the little guy and forced him to sign his already battered credit score away at the point of a pen. Others point the finger to the irresponsible borrowers (home buyers, credit card holders, and people in debt to loan sharks…) for signing up for the ride. The truth is somewhere in between all these. We just had a big money party, and now we’re waking up with the hangover.
And all the while, nobody was telling us that party would end. Nobody would have listened if there were. But now things are changing! People are waking up, rubbing their heads and pocket books, and are demanding to know who could have averted the crisis. They want to know how they could have seen it coming. And then they think back to grandma and how she never had anything fancy, but seemed to have everything she needed. And then the realization comes… “If only I had done things differently…”
Well, now there are plenty of messages out there, like ours, promoting personal responsibility and personal finance education. In this transcript of a radio story that aired on Voice of America, we hear that people are out there taking high school and college students by the ear, so to speak, and teaching them about the true cost of debt, including credit cards and student loans. They are trying to reduce the number of students who file for graduation and their bankruptcy at the same time. They are getting the point across that getting a college degree may just not be worth the student loans, if the income after graduation cannot pay the loans back for decades. They are letting people know that employers are looking at credit histories when making hiring decisions and that some jobs, like law enforcement, are out of reach to those with a history of bad financial decisions.
Wish your kids, “Happy National Financial Literacy Month!” And take them to the Financial Literacy Month website, put up by Money Management International. Each day of April, you can take a step toward financial well being, while setting a good example for your children. If you are the kid, ask your parents to work through the site with you, and maybe you’ll teach your parents a thing or two.
There is no such thing as perfect personal finance. You just need to get the education for yourself that you didn’t get elsewhere. It’s not something you can get finished within a day, a month, or even a year. It only takes small positive steps toward a goal over the long term to make a big difference. Learn a little bit today. Practice it often. You will be rewarded for a lifetime.
Voice of America is a multimedia international broadcasting service that broadcasts approximately 1,500 hours of news, information, educational, and cultural programming every week to an estimated worldwide audience of 134 million people. It hopes to teach the world American English and promote a positive view of the United States of America.
Tags: Budgeting, Financial planning
