Friday, February 8, 2013

We Need to Teach Financial Literacy - But What Should We Be Teaching?

Interest Rates
Interest Rates (Photo credit: 401(K) 2013)
by Lance Winslow

Isn't it time that we taught basic economics in our high schools and colleges?

Shouldn't we be teaching basic balancing of a checkbook in middle school, and perhaps even teach a little bit about budgeting in the fourth, fifth, and sixth grade?

Often we seem to be purely focused on reading, writing, and math.

That's good, the kids should learn that too, along with some history, so we are not all doomed to repeat it another 20 years when they all grow up.

I'm okay with all that, I agree, but we must also teach a little more financial literacy.

Let me explain. It seems that we ought to be teaching:

1. How to Balance a Check Book
2. Family Budgeting
3. Simple Interest
4. Amortization
5. Inventory in Business
6. Basic Accounting
7. Basic Economics

You see, if we don't teach financial literacy to those who are free today they will become economically enslaved tomorrow. What's the difference between slavery and economic enslavement except perception?

Young people are too apt to go out and get credit cards, finance a brand-new car, and get themselves in hock for unlimited amounts of tuition costs and student loans. This won't do them any good for their future, and they need to be thinking about this in advance. Are they being taken advantage of? Some are, but isn't it our fault for allowing this ignorance and not teaching it in our schools?

Of course, on the flip side, I am also not one to allow someone such easy discharging of debt for the choices they've made, nor do I bother to fall for the excuses, class warfare, or claims that somehow folks were misled.

Allowing people to discharge their debts too easily makes them even more irresponsible, and they are not apt to learn the lessons, worse when it is the taxpayer who has to foot the bill, or those who actually did pay their debt in higher interest rates and costs.

The responsibility must be with the borrower too, and making more laws and this nonsense of Frank Dobbs has slowed our economy something terrible, especially our housing recovery at a time of historically low interest rates and home prices, exactly when one should be buying real estate not at the 2007-2008 top.

Further, for those who suggest that minorities have been abused through the credit process and kept down, well, I'd say this has NOTHING to do with race, it has to do with responsibility, basic understanding, and the "I want it now" attitude which permeates our society (all races), as it is this "I deserve it" motif which plagues us. Indeed, I hope you will please consider all this and think on it.

Lance Winslow has launched a new provocative series of eBooks on the Future of Education. Lance Winslow is a retired Founder of a Nationwide Franchise Chain, and now runs the Online Think Tank;

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