Should We Make Our Kids Take Finance/Business Classes?

Should We Make Our Kids Take Finance/Business Classes?

Scott TrenchPro Member
Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes

So this is a subject that I’m very interested in and I’d love to get everyone’s opinions.

What do you think about mandating Finance class for grade school children?

I’m not talking about making them take it one year of high school, or making it a part of math class - I think a lot of people (at least on BiggerPockets) would agree that there should be some improvement in our finance/business curriculum in public schools. No, I’m talking about full-blown making it a focus of the United States (and the world’s) public schooling curriculum - given as much priority as language, math, and science throughout the entire 12 year duration of public education.

My (perhaps naive) opinion is strongly in favor. Let me know if you disagree!

Here’s my argument:

When I was growing up, I was a pretty good student. I got decent grades in Math, English, and Science, though I was certainly lacking talent in the art and music departments. But there was one subject that I didn’t master. I didn’t even get the basics down. In fact, I was never even taught it. That subject was finance.

Like it or not, in our capitalist society food, shelter, transportation, wealth, and power stem largely from one thing - money. The fact that we don’t absolutely mandate the education of all things money through the duration of our children’s schooling is totally mind boggling to me.

Sometimes people say that finance is boring, that it is a study children might not enjoy, and that they might not comprehend.  To that argument, I’d repeat what I heard growing up every time I didn’t like a subject in school, but had to do my homework anyways:

Too Bad.

A lot of kids don’t like ANY courses in school. We make them go anyways. That’s because we believe that those things are part of life. We believe that they are necessary skills for them to develop. What about money matters? How can they not be at or near the top of the list in subjects that are critical to our children’s development as human beings and as effective citizens?

Let me leave you with one final thought.  Have you ever heard someone say, “Oh he’s really good at that - he’s been doing basketball/violin/piano/coding/insertcoolskillhere since he was six”?

Yeah - he’s good because he’s been doing it since he was six.

Let’s make the world’s kids great in what really matters for them. And let’s get them started early.  Let me know your thoughts.  AND if you think some sort of change could be realistically implemented.

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Real Estate Consultant · Federal Way, WA · Member since 2012 · 74 posts · 13 votes
11y

I strongly agree with the concept of beginning to teach financial literacy at a young age - and continuing through the end of high school.  It would be great if it was a part of school curriculum in a meaningful, comprehensive, age appropriate way. 

There is a financial literacy program available to everyone, sponsored by the credit union industry.  It is shown on TV in some areas, and there area episodes available to all online at www.bizkids.com. 

The US Mint offers lesson plans and more financial literacy support activities with an elementary school focus.  Their website is www.usmint.gov. 

There are also some really good, age appropriate books out there to help.  Full disclosure - I worked for a local credit union for several years and my focus was financial literacy for children and young adults.  If I can be of help, please let me know.

See this reply in the discussion

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  • Investor · Ogden, UT · Member since 2014 · 24 posts · 18 votes
    11y

    Parents have different methods of teaching their kids financial skills.... if they have any at all. Lets take a step back, most people have a poor grasp on their own finances, I wonder what financial lessons they'd try to teach their kids. I have friends whose parents gave them allowances and taught them to budget, but as adults they still have debt.

    I definitely think kids should have more formal lessons. Kids in school constantly complain about the lack of future use for algebra and geometry, so teach them the same lessons with financial applications. Kids can't argue that they'll never use money. Instead of senseless word problems about Jane buying 1,000 watermelons, why not fill math books with word problems related to finances. 

    I've taken economics at a college level and didn't learn anything about personal finances. Most people have no idea how a credit score is calculated, the difference between a roth IRA and regular IRA, how to calculate ROI, etc. Schools leave teaching life skills to parents who don't adequately teach their children, it's kind of a broken system.

  • Houston, TX · Member since 2013 · 483 posts · 189 votes
    11y

    They only thing i regret about school is that they do not teach you about money. I would be in a far more better state if i am exploded to the subject of money and understand the value behind it before i reached my twenty. 

    So year,  I would make my kid jump into the subject of finance and money as soon as they are ready. 

  • Contractor · Nampa, ID · Member since 2014 · 20 posts · 3 votes
    11y

    I don't have any kids yet, but my plan was to aggravate them so horribly bad that they decide to educate, as opposed to me forcing it on them. What I mean by this is giving them a 20 dollar a week allowance but taking 25% for taxes, creative surprise costs like disabling the door knob to their bedroom etc etc. However I'm also going to give them opportunities for them to use their money to make more money. I like this post as I have been thinking about this for quite some time.

  • Scott TrenchPro Member
    OP
    Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes
    11y
    Originally posted by @Account Closed:

    @Scott Trench 

    A good topic... I would make them take "personal financial management".  Required reading for the course would include:

     "The Richest Man in Babylon"  By George Samuel Clason

    "Think and Grow Rich" (original 1937 edition) by Napoleon Hill

    "The Science of Getting Rich" by Wallace D. Wattles

    I would also require them to submit a class project, which would be a business plan and requirement to raise capital and take action to actually implement the business plan (I started a lawn moving business at 12 years old).

     Jon - This is a great book list - I actually haven't read "The Science of Getting Rich".  I'll have to check that out.

  • Scott TrenchPro Member
    OP
    Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes
    11y
    Originally posted by @Lacey Russell:

    Parents have different methods of teaching their kids financial skills.... if they have any at all. Lets take a step back, most people have a poor grasp on their own finances, I wonder what financial lessons they'd try to teach their kids. I have friends whose parents gave them allowances and taught them to budget, but as adults they still have debt.

    I definitely think kids should have more formal lessons. Kids in school constantly complain about the lack of future use for algebra and geometry, so teach them the same lessons with financial applications. Kids can't argue that they'll never use money. Instead of senseless word problems about Jane buying 1,000 watermelons, why not fill math books with word problems related to finances. 

    I've taken economics at a college level and didn't learn anything about personal finances. Most people have no idea how a credit score is calculated, the difference between a roth IRA and regular IRA, how to calculate ROI, etc. Schools leave teaching life skills to parents who don't adequately teach their children, it's kind of a broken system.

     Thanks for the comment Lacey!  This is exactly it - I think I agree with every word you say here.  The answer can't be "finance needs to be taught in the home"!!!  Most parents and Americans couldn't teach a finance course, so the only kids getting this education are (in most cases) the wealthier ones.  This is so unfair and in my opinion, probably a HUGE part of the reason for income inequality.

  • Investor · Plano, TX · Member since 2014 · 23 posts · 10 votes
    11y

    My experience...Don't wait for schools to change!  Do what YOU can control...  take action where YOU can make a difference in this area.  I've seen good things by doing...

    Games:  At school or at home.. Rich Dad Poor Dad's game called Cash Flow for Kids.  Very young kids can "get it" by playing.  Future Real Estate moguls start here :-)

    Volunteer:  Check out organizations like Junior Achievement and be a volunteer to teach concepts relating to money & commerce.  Starts in kindergarden thru high school.  At the time I did it, it was not restricted to underserved communities.

    Volunteer:  Look in to NFTE  (National Foundation for Teaching Entrepreneurship) and be a mentor or judge for underprivileged students who are writing and defending business plans in front of adult judges.  Start with middle school age.  I love this organization.  It will give you hope.  This is a program done in underserved public schools (major cities).

    Volunteer:  Get out and help those who are craving guidance.  Your church or community center may have opportunities to mentor or teach a personal finance program to adults wanting to change the legacy of their family.

    Take your kid to your financial planner/broker:   After a 30 minute chat with my broker, my 18 year old daughter said "I learned more in that 30 minutes than in 4 years of high school" (on subject of money).  [She's now in college living in our rent house that her roommates are paying for, of course.]

    A Google search may bring up various options to volunteer or even to speak at a youth organization.

    We are ALL teachers, right?

  • Investor · Sherman Oaks, CA · Member since 2008 · 6k+ posts · 3k+ votes
    11y

    I agree about the cash flow game for kids. A book by Robert Kiyosaki called Rich Kid Smart Kid goes over many simple business ideas like where's a cash flow statement and what's a P and L statement?

    Learning everything from the Federal Trade Commission site Ftc.gov about what's a loan whats a credit rating, what's the fair credit reporting act are just basic consumer credit educational ideas.

    I think too bringing 14 yr olds into your Financial and credit life such as bringing them into a car dealership or a bank opens their eyes to what's coming up when they hit 18.

  • Rental Property Investor · Trabuco Canyon, CA · Member since 2014 · 134 posts · 78 votes
    11y
    Originally posted by @Micki M.:

    I'm not going to be redundant, I think the obvious benefits and challenges have been well stated... I'm just trying to imagine an America where a majority of people live within their means, use credit responsibly, and have been planning for their financial future since Jr. High. What would the impact be? I'm sure there's an intriguing novel/film to be created on that concept.

    I am not sure this is possible. There is a lot of vested interest in dumbing down the American public so they cannot support themselves and start relying on the government handouts: this is how you breed a stock of obedient voters.

    If people become financially savvy, they will be smart enough to realize that the government is leaving beyond their means and are giving the bill to the future generations. Then a lot of the people in the government (especially the one with the cushy teacher's union jobs) would be out of a job and kicked on the street. No teacher would want that - they would rather teach kids how to work for someone.

  • Specialist · Daphne, AL · Member since 2014 · 114 posts · 18 votes
    11y

    I say absolutely Yes! Dave Ramsey has written a series on finances, chores, budgeting, spending and saving for younger and older students. I recommend it for any parent. Regardless of what your child decides to do as an adult, they will always have to deal with money. Better for them to do it with as much knowledge as possible. 

  • Rental Property Investor · Trabuco Canyon, CA · Member since 2014 · 134 posts · 78 votes
    11y
    Originally posted by @Dawn Anastasi:

    The people in jail have no freedom.  They can't go and see a movie whenever they want.  They don't have the privacy like you and I do. Someone monitors what they do, decides what they wear, and what they eat.  Do you really envy someone with no freedom and privacy?

     The majority of the Americans live in a jail without realizing it: 

    • they cannot go to see a movie because they cannot afford it.
    • they cannot go on a vacation because their bosses would not let them, cannot afford it, are afraid someone will take their job or all of the above.
    • they live in tiny cells they call apartment because they cannot afford a bigger one
    • they get robed/raped/killed because they cannot afford to move to a better one
    • they rely on the taxpayer to provide for them because they cannot do it themselves
    • they watch whatever their uberlords tell them to watch because they have been trained as kids to follow the crowd
    • they don't think for themselves because they are told that the rules are stacked against them and there is nothing they can do to change their own circumstances. They are so much institutionalized that they don't even want to try anything different (a great scene from "The Shawshank Redemption" comes to mind.

    It takes a dedicated effort to pull yourself out of it. Freedom requires work - and heavy effort. You have to earn it(take it) like the founders of this country. They didn't wait on the government (i.e. King George) to come and proclaim them free.

    Staying "Free" also requires work - a constant steady fight for every step on the way. For some people this is too much: "I would rather go to school and study so I can find my safe cushy job and stay there until I retire".

  • Investor · Cedar Rapids, IA · Member since 2009 · 143 posts · 29 votes
    11y
    Originally posted by @Scott Trench:

    One thing I want to discuss is the concept of the difficulty of agreeing on a curriculum.  I think we have this problem in every subject, and that many of them are far more problematic than finance.  Look at history!  Look at how much controversy surrounds just the study of European settlement of the U.S. and their conflict with Native Americans! 

    I think that finance is WAY less subjective a field of study than History, English, or any other Liberal Arts course.  I don't buy the argument that its not feasible.

    I don't mean that the curriculum would be any more difficult than any other subject to put together. I mean that even agreeing to have a class on the subject required would be difficult. There's only so many hours in a school year making it a zero sum game. Adding a new class would de facto require removing another. Which will it be? Math? Science? English? I think it's important enough to need a spot, but making the difficult decisions necessary for it will be the sticking point causing it to be difficult to accomplish.

  • Rental Property Investor · Phoenix/Lima, Arizona/OH · Member since 2012 · 4k+ posts · 4k+ votes
    11y

    My life is the monopoly game - my kids see it and live it :)

    Totally agree!

  • Real Estate Investor · Ft. Benning, GA · Member since 2012 · 36 posts · 6 votes
    11y

    I wish I was taught more about money in school, besides how to fill how a check book. Trying to figure it out at 29 with three kids and a wife is a challenge to say the least. If I figure this stuff out, I will make damn sure my kids know it too.

  • Real Estate Investor · Milford, PA · Member since 2014 · 395 posts · 299 votes
    11y

    To answer the question ABSOLUTELY. Those classes though are more apt to come from us the parents and my favorite school- the school of hard knocks. Then any formal institution. 

    A few thoughts:

    @Kathleen Wilcox thanks for the links. I will be checking them out.

    @Jon Strishak  thanks for the idea. I will be using it this summer as the kids enter Dads school. I never thought of making them right a business plan. I will scale it down as they are 12 and 10, but I love this idea.

    I for one do believe that personal finance should be taught. Though I doubt it ever will be. The education system is a way of turning out workers and robots.

    If you had everyone living below their means and reaching independence then who would work.  Who would the politicians be fight for.

    So, I for one am happy that they don't teach it. For my children have a leg up on the competition. They are only competing with 1 or 2% of the population. And the school system is creating plenty of customers / employees for them.  

    Some of the things I do to help them learn. 

    I tax every dollar they get. Birthday money, toys sold on craigslist, money from helping neighbors, communion money eveything.  It gets taxed. Then they pay themselves 50%, this is their savings. Then they get to have a small chunk left to spend frivolously. 

    Any money they wish to invest goes into their 401k, which right now is a mason jar on the counter. I will match it dollar for dollar. The only rule is once the money goes in it never comes out. I also pay them 5% interest.  I started this with my son. The second my daughter found out she immediately broke out her piggy bank.  

    I discuss buying the best product you can afford. 

    I discuss what a want is and what a need is.

    I discuss real life scenarios and why I did what I did. I also show them my "failures".

    I will ask them, So what do you think? What would you do? Why? What do you think about doing this? This sometimes leads to an hour long conversation and research time. These short little snippets is how i really teach them.

    How the single thing I am most proud of is everything you see I earned. No one brought me three houses. No one put money in my 457. No one created a high credit score. No one gave me my tools (actual tools as in wrenches and saws).  Everything I have is because I made hard decisions and did without many things. I still drive a car with over 200k miles.  

    I believe that the opportunity is there but like our forefathers you must seize it. You must take it, you must fight for it. It will not just end up in your lap.

    It's great to see threads like this. It really gets me thinking and I pick up a lot of ideas to implement in my own "Dads" School.  

  • Real Estate Agent · Virginia Beach, VA · Member since 2012 · 2k+ posts · 1k+ votes
    11y

    Just wanted to add that there are many resources out there, for free, that are available right now that anyone can access to build personal financial knowledge.  PTAs, school business clubs, guidance counselors, etc., could (and do, I believe) promote these free resources.  

    Online, for instance: 

    http://www.practicalmoneyskills.com/personalfinanc...

    Another poster here already mentioned BizKids on PBS and www.bizkids.com (with a lesson plan link for teachers).  Khan Academy is a great source for free knowledge and has a personal finance section.  I, personally, learned a great deal from skimming through whole sections in the local library and picking up the major themes running through them -- personal finance, retirement, economics, etc. 

    While I think devoting a few weeks to teaching a basic understanding of credit cards, student loans, credit scores, etc., mixed in with another class (maybe along with sex ed) would be beneficial to high school students in general, extensive mandatory instruction in personal finances would have too many very personal variables to be taught successfully in a class setting with tests and grades attached, and could actually prove harmful if certain philosophies are given more weight than others.            

  • Scott TrenchPro Member
    OP
    Rental Property Investor · Denver, CO · Member since 2014 · 2k+ posts · 6k+ votes
    11y

    @Lynn McGeein I'll disagree here that financial education could prove harmful or that a basic few weeks course would prove beneficial.  In my opinion, its the difference between rote learning, and application.  Why do we make students study literature long past when they become "literate"?  Why do we make students take advanced mathematics past basic arithmetic?  

    Why not finance?  They are going to be exposed to it for life!

  • Investor · Reston, VA · Member since 2011 · 683 posts · 191 votes
    11y

    Good topic.  I agree with, and relate to, many comments.  Personal Finance should be taught in school and integrating these concepts into other courses is an excellent idea (btw - having the word "rich" in the title of any required text will never fly, imo). I took a Pers Fin class freshman year in College (I was an econ major) and learned some good stuff.  I was happy to see that it was still offered when my son enrolled in the same school.  I insisted that he take it.  I was very aware of my parents financial and business activities from a young age - I'm quite sure that I knew much more than they were aware of!  I was around 16 when I first calculated my net worth.

    I shoveled snow (I actually looked forward to a big storm and was up at the crack of dawn with a shovel on my shoulder and wasn't back home until dark), cut grass, raked leaves, etc.).  Why?  I wanted movie money, PF Flyers, records, clothes, a sting-ray bike, etc.  At 12 I started a bait stand on the road above our cottage (my mother helped set it up) because I loved to waterski and needed gas money.  I spent summers painting and cleaning my mother's apartments for 50 cents an hour.  I had saved-up (I was never "forced to save" and have doubts about that tactic), and bought my first car two weeks after I turned 16.  I have a point to make here:  none of my siblings did any of these things.  Guess who has financial success?  One lives paycheck to paycheck.  Same parents.  Same education.  "Nature" plays a big role.

    Despite my best efforts, my son has no interest in RE.  I did find him an reo which he bought at age 20.  I can't blame him if he is not interested; different strokes...  I am a Hall of Fame athlete at my Ivy School.  My son has the genes but never had any interest in sports.  He likes to read.  Again, out of my control.  I can say that he handles his finances very well and excels at his job. He maxes his roth and 401, saves and invests.

    Financial illiteracy is a huge problem in this country and should be part of basic school education.  Sure, it should be a parental responsibility - but, as has been pointed out, the kids that need it most are unlikely to have parents capable of any contribution. 

  • Cumming, GA · Member since 2014 · 218 posts · 71 votes
    11y

    Bump!

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