How much could a program like this help the US

[Big Country]

Not likely that this would ever get off the ground here with all the localization of schools, but, just curious what others think could improve if we instituted some basic level of personal financial education throughout the education system. maybe a little more general knowledge could keep people from overspending, or do you think I am being overly naieve in thinking that if people actually better understood the actual cost of their spending habits they wouldn't change them, or, in this case, grow up with a different attitude towards it?

 

Link to Article

 

We like to think we’re global leaders in the U.S. and, of course, we are in many important ways. But while we dither over how to best teach kids about money, half a world away they are actually doing something about it.

 

Financial education is a free-world issue. The U.S. and U.K. have generally been out front looking for a silver bullet that will make citizens smarter about credit, saving and spending. But while we talk, and talk some more, in New Zealand and Australia they are taking concrete steps.

 

Check out the government-run financial website in New Zealand at sorted.org.nz. It’s clean, organized and up to date. There’s plenty on this website for English-speaking consumers in any country, including games that help kids understand money. The U.S. has a useful financial website at mymoney.gov. But it’s not as good as it could be. Indeed, high on the list of the newly appointed President’s Advisory Council for Financial Capability is creating a world-class online site for financial information for U.S. consumers. Studying the New Zealand website would be a good place to start.

 

What really catches my eye, though, is a recent news item out of Australia. Beginning this year, under federal law financial education will be integrated into the nation’s school system in grades K-10. The rollout will take three years and will work like this:

 

· Year one Kids will begin to see financial concepts presented in English, math, science, and history classes. What does this mean? Spelling bees might include words like “mortgage” or “amortization.” Math assignments might include equations that compare loan payments at different rates of interest. History classes might look at the economics of war or origins of investment bubbles and stock market busts.

 

· Year two Kids will begin to see financial concepts presented through the arts, and in geography and language class. So, they might script and perform scenes at a bank, on a car lot, or in a home as a family sorts through its cell-phone options, or examine the varying costs of living in different regions.

 

· Year three Kids will begin to see financial concepts presented in physical education and across the humanities. So, they might study the personal and social costs of poor health habits, philosophies of wealth and philanthropy, and works of literature with money themes.

 

The whole idea is to teach the Three Rs — but use money concepts in addition to traditional examples, illustrations and exercises.

 

Integrating social lessons into basic schoolwork has been effective in some states in areas like sustainability and economic justice. It can work with financial literacy too. Sadly, though, we don’t just lack a federal mandate to integrate money lessons in our schools; we have a pledge from Education Secretary Arne Duncan’s office to avoid taking that exact step.

 

Our national strategy is to let individual states deal with financial education however they see fit. In Australia, they have both a federal mandate and federal money to train teachers.

 

It’s always been like this at home. The states run their schools. No one seems willing to challenge the status quo. So I suppose we’ll go on raising kids who believe that winning the lottery is their best shot at a comfortable lifestyle.

[Avernus]

the problem would be minimized by at least 50% and people would be smarter about how to manage money and so on...

[cliaz]

But if we start to become a money conscience country then we wouldn't have any debt to sell to China

 

But in seriousness, the credit lending entities of the US would fight so hard to keep a program like this out. (IMO)

[Ursa Majoris]

My local school district already has electives for this and much more in a similar vein.

[Grimm74]

This is something I have been screaming for for years. Most or a large majority of our problems in the US are from peoples inability or unwillingness to face financial truths. A VERY LARGE percentage of people in the US can afford health insurance. They just chose not to. I am not saying all I am saying most. This goes for education and etc.

 

I think financial institutions would absolutely love this, but I tell you who would not is parents. Banks need responsible borrowers, but Imagine johnny coming home and saying Mom can we really afford that? Or maybe we should save a bit more money or not use the credit card so much...

 

One small example and there are many is my typical grocery store run. This happens to me or I see it a hand full of times a year. I am at the grocery store and the folks in front of me have a cart full of name brand foods paying with food stamps. They then load up their expensive food in a new Benz. I on the other hand who makes a very good living drives up in my coupon filled 7 year old truck buying generic food.

[whoopazz]

My daughter is about to graduate from UNC with a biochemistry degree and minor in German (generally a smart kid). She asked me if I could teach her basic personal finance when she gets out ("I know nothing of these things" she says). Thats what got me thinking a while back that our basic school curriculum should include something along these lines.

[muck]

This is very similar to how many families who homeschool teach a variety of subjects. That in and of itself probably makes it a bad idea to those invested in public education.

[westvirginia]

This is very similar to how many families who homeschool teach a variety of subjects. That in and of itself probably makes it a bad idea to those invested in public education.

 

 

+1, we're a member of a home-school co-op for some stuff like this.

 

But I learned about balancing checkbooks and a little about credit (it wasn't as complicated in the late '80's, of course) in my Economics class required either my Junior or Senior year. We did some very simple time-value of money scenarios to show how you end up paying 3-times the price for a house, X% more for a car, and how you could save to pay for something much more quickly. It was enough to make an impression that I remember it, though I don't remember a single day of any of the three algebra classes I had that I tend to use often.