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May 20, 2010 / Brent Sears

Where Did You Learn about Money?

If you graduate from college with a four-year degree it is safe to assume that you spent 17 years of your life being educated in an institution.  In that time you learned about math, science, history, sex, drug abuse, alcohol abuse, how to stand in line, how to take a written test in gym, how to fill out miles of dittos, work in groups, work alone, and on-and-on to infinity.

How many lessons were given on how to manage money?  Probably close to none.  Why aren’t schools teaching personal finance?  Everyone uses money in some form every single day, but all through formal education the topic is totally ignored.

Is it any wonder that it was announced yesterday that 10% of the mortgages on the books right now are late in paying?  That is a record.  It’s simple: people bought larger houses than they could afford, and then they found that they couldn’t pay the monthly payments.  Many of these were “well educated” people.

One of the pervasive ideas of the 20th Century was that consumer debt was good.  It’s easy, and SOOO convenient.  The reality is that it destroys lives and makes people feel trapped.  I am hoping in the 21st Century we are finally waking up from the spending bender, but don’t count on institutions to lead the charge up the hill.

People first, then money, then things.

-Suze Orman

Live like no one else, and later on you can live like no one else.

-Dave Ramsey

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2 Comments

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  1. Nicole / May 20 2010 15:17

    The crazy thing is that most high schools do offer financial literacy courses through their business department. But with all the recent lay-offs, the first departments hit are “elective” and non-required areas, and what gets lost when these teachers are cut? Relevant courses, such as ones dealing with financial literacy. Why are we in this financial crisis to begin with? Maybe because we are not teaching our students critical financial skills before they leave school. Because of this, our graduates don’t know how to handle money and, as a result, beneficial educational programs get cut, which may have been our one chance to get us out of this financial crisis…a lovely, vicious circle.

  2. brentsears / May 21 2010 07:32

    I believe in the coming years there is be a shift in the way people think about money, debt, and the definition of financial freedom. The past was all about consumption, and I hope one of the benefits of the financial crisis will be that people wake up and live within their means.

    Sadly, schools are the places that teach consumption, not in the classrooms, but it the hallways. One student get the new Ipod and it becomes the standard, until next week when something different comes out.

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