How My Single Mom Taught Me the Importance of Financial Knowledge
A few years ago, I saw a video by YouTuber David Paul Brown about not staying in school. I remember it resonating with me deeply.
I don’t agree with everything Brown says in the video, but I do believe that the lack of real-world education in our school system is concerning. We are told there are many reasons why we don’t teach kids about our current political climate, basic first aid, or how to manage their finances.
One of the most cited explanations from school boards to teachers is that there just isn’t enough time in the curriculum to add these topics. In addition, many public schools emphasize test scores and how their students perform on standardized tests above all else. As such, it’s become more common for parents to handle the real-life details not taught in schools.
I don’t think this should be the case. I believe that schools should work toward providing a more balanced education, one that focuses on the fundamentals of math and history while also teaching “real life” skills, particularly budgeting.
Financial Education Statistics
Seventeen states now require financial education in their high school curriculum, according to a study by the Council for Economic Education. For schools that don’t mandate a life readiness course in personal finance, some educators have taken on the task of teaching money management to young adults themselves. Many teachers have found creative ways to integrate financial literacy into other subjects.
“In my personal experience, efforts that start with a passionate educator in the classroom have proven to be most effective,” says Talitha Oliveri, an educator and Distributive Education Clubs of America adviser. “One English teacher in my building has students create a budget for a trip to New York City based upon the characters in the novel students are reading.”
“Balancing real-life skills with traditional topics takes planning and an open mindset,” she continues, “but the opportunities are endless.”
Learning the Importance of Financial Knowledge From My Mom
Despite my high school’s lack of financial literacy courses, I was lucky enough to have a parent who did believe in the importance of teaching me about my finances at an early age.
I grew up with a single mother who raised me according to the “learn now for success later” mindset.
For four years, our family had a financial downturn while I was in elementary and middle school. Despite speaking little English, my mother managed to sell our house by herself and get us into a more affordable and size-appropriate apartment.
I’ve always admired my mom’s strength and determination when facing adversity, both emotional and financial. I understood when she began placing financial responsibility on me despite how young I was.
Checking and Paying Bills
My first job was checking and paying the bills at home. I’m surprised by the number of people my age who never check their credit card bills before paying them, or those who don’t save purchase receipts. They skim through their expenses thinking, That’s about right, right?
Of course, most of the time there won’t be any mistakes on your credit card bill. And perhaps you somehow manage to remember all of the amounts you’ve spent in a month down to the dollar. But for those times that something does go wrong, it’s always better to have a record.
In fact, in the three years that I’ve owned a credit card, there have been three charges that I’ve had to dispute, either due to credit card information theft or a systematic error. That’s around $400 dollars I got back without a single dent to my credit. Had I not been keeping track, that would have been $400 down the drain.
Other Accounting Lessons
Additionally, paying the bills taught me how to write a check, record it, and balance my checkbook.
I was also brought along to any interaction my mother had concerning money. We went to banks to set up new accounts, where we learned about what can be done with a credit line. We figured out what a credit score is, and how it affects us. Beyond that, we went to our accountant to understand how to file our taxes.
On top of this, I learned how to save on everyday expenses and find the best deal. We called dozens of service and utility providers to figure out which package was most useful and least expensive.
Whenever there was a problem with any charges or services, my mother would sit by me while I spoke with the customer service representatives.
At the time, I thought these trips were boring. They seemed like a frightening view into a snippet of adult life. Now, I’m forever thankful for these trips.
By watching my mother, I was able to understand the concepts behind how to lead a financially sound life.
As an adult, I find that the prospect of finding an apartment and paying my bills doesn’t feel as scary as what some of my peers make it out to be.
Our traditional education system has never provided the answers to questions about life after school. But many of us have the greatest teachers for that in our own homes. Our parents have been through it all. They know how to survive in a world that’s driven by money.
Tips for Teaching Kids About Money
Financial education app Famzoo offers a pocket-size breakdown that incentivizes teens to save for the future. We spoke with founder and “Chief Dad” Bill Dwight about his best practices for parents teaching young adults financial literacy. Here are his tips:
- Teach teens the power of compound interest through parent-paid interest delivered each week.
- Use a simple reimbursement process to teach kids the value and cost of everyday items.
- Don’t protect your kids from “magic money”; give them debit or prepaid cards in lieu of cash.
- Charge teens for their share of family plans so they don’t think life’s everyday shared services are free.
- Introduce your working teen to low-cost, tax-advantaged, long-term investing with a family 401(k).
Additional reporting by Connor Beckett McInerney.