Reading, Writing, and Interest Rates
September 11, 2013
One of my favorite television shows is called Biz Kid$. In this great educational program on PBS, young people are taught about real-life economic situations, from starting your own business to buying your first car. It demonstrates how things like investing in the stock market works and explains what an interest rate is. It also has episodes dealing with how to avoid falling for scams, something that is particularly useful in this age of the Internet. Basically, Biz Kid$ covers the everyday money situations that both kids and adults will encounter in their lives, and it does so in a very fun and clever way.
Seeing Biz Kid$ for the first time reminded me of another show that I saw years ago called Street Cents. In that program, kids were taught the value of their money and how to make good decisions with it. They also showed how advertisers try to hook you into spending more, and they gave kids tips on how to be smart consumers. At the time, I thought myself wise to the ways of those wily advertisers, but I still learned a lot from Street Cents. And even though I am now an adult, I have learned things from Biz Kid$. But I have been thinking, shouldn’t I have learned this stuff in school?
School is supposed to prepare us for life. However, it amazes me how many things I was taught in school that have been absolutely useless in my life since graduating. Take Geometry, my least favorite subject. Math has never really been my thing, although I was usually able to pull through with an A-. Then came Geometry. The need to bisect angles and use a protractor, as well as do proofs, was incredibly difficult for me. I much preferred straight forward addition and subtraction, with a little algebra thrown in. The entire yearlong ordeal that was Geometry class was torturous. Now, twenty years later, I look back and ask a very important question: What was the point?
The purpose of many classes in school is to give kids a sound educational basis for whatever path they ultimately choose to take. But once kids are in high school, there appears to be more emphasis put on preparing students for college. That is the reason that I took Geometry. Of course, it can give a great foundation to those who want to go into a profession in which you absolutely need to know the angle of an isosceles triangle. However, for people like me who won't end up in such a profession, Geometry was a bit of a time waster, as were some other classes I was required to take. I can’t help thinking that I would have benefitted much more from a course that covered the kinds of subjects that Biz Kid$ does.
Unfortunately, I never had a class that showed me how to balance a checkbook. No teacher took the time to explain how loans work or what actually happens when you purchase something on a credit card. There was no training provided on how to interview for a job, how to rent an apartment, or buy a house. And, the stock market, in some ways, remains a mystery to me to this day. It would have been a great help to me as I entered the adult world if I had received some instruction on these very important topics. Much more helpful than Geometry.
Now I am sure there are a lot of people who are thinking that I am being too hard on good old Geometry. Let me be clear, I am not saying that it isn’t useful and shouldn’t be taught. However, I do feel that not enough focus is being put on subjects that can help prepare students for the real world, college bound or not. As great as it would be for every child to go to college, the fact is that many don’t. And even those that do could definitely use the kind of practical education that I am talking about. Just look at how many students are currently drowning in student loan debt. I wonder how many of them really understood what they would be facing once they graduated, or were knowledgeable enough to get themselves the best deal on their loan.
Many people who are suffering right now as a result of the economic meltdown made some bad decisions with their money. And these people are often looked down upon by the financially literate who believe that they brought it on themselves. But how many of these people had a solid understanding of the economic forces at work? Who teaches people what the right financial decisions to make actually are? The sad fact is, unless you can afford your own accountant, most of us are on our own in trying to figure things out.
So why aren’t these issues taught as a regular course in school? Why did it take a TV show geared towards kids, two decades after I graduated, to get me to finally understand why a diversified portfolio is important when you are investing? While there are some classes in school that do deal with these things, they are usually part of courses designed for those who are interested in a career in the business world. It is now time, however, for all kids to be taught these everyday life lessons. No child should leave school without knowing how to use a credit card properly. No child should graduate without knowing how to save money and what a good interest rate is. In essence, no child should enter into this economy without knowing how to survive in it.
Check out Biz Kid$ on PBS and also take a look at our new database called Financial Literacy that teaches about all things economic. It’s designed for grades 7-12, but can be useful to all ages.
Here are also some books that can help teach kids about how to handle money (adults might pick up some pointers as well):
- Saving Money by Philip Heckman
- Budgeting by Sandra Donovan
- The Everything Kid’s Money Book: From Saving to Spending and Investing—Learn All about Money! by Diane Mayr
- Neale S. Godfrey’s Ultimate Kid’s Money Book by Neale S. Godfrey
- The Secret Life of Money: A Kid’s Guide to Cash by Kira Vermo