Personal Finances Curriculum
Personal finance curriculum ought to be a part of every high school freshman's education across the country. The reason is simple; money doesn't grow inside ATMs and credit is for emergencies. Maybe the reader knew that but most fourteen year olds don't have a clue. This is all drop dead serious stuff because seventy percent of all Americans are living pay check to pay check and have no appreciable savings to cover emergency situations. When people begin to think that one hundred dollar athletic shoes are the norm and paying four fifty for a cup of coffee is a bargain, there are serious issues to be dealt with and the answer is a personal finance curriculum in place long before high school has ended.
Take first the crafting of a personal budget. For many people, the word budget means something cheap, like a car rental or a hotel. A budget is a guide, a measuring tool to keep expenditures in line without using credit. A personal budget is a watchdog over wasteful spending and disciplined savings and helps a person understand just how much or little is being made each month. The budget is the central core of everything else financial in a person's life and provides stability and a strong sense of direction in money matters. But some people actually resent budgeting because adhering to a budget makes them feel poor or deprived. That kind of anti-budget sentiment is a symptom of woeful financial ignorance.
If personal finance curriculum is to succeed in teaching young people how to handle their money, then an understanding of expenses, both expected and unexpected should be discussed. The difference between real, needful expense and wanton expense should be clearly delineated in the curriculum. Discussions about living a life without credit card assistance means taking on the American materialistic life style head on and helping its younger citizens to see how much advertising and the press manipulates people into thinking that so much stuff is needed for happiness. A very genuine and helpful personal finance curriculum for the schools would include discussions of lifestyle excesses and the drive to accumulate wealth that drives many people into credit slavery.
If a personal finance curriculum for the schools is to first include the understanding of a budget and then to help guide them through what expenses are legitimate and which ones are not, then the third chapter in the course ought to be an understanding of the tax system. Why? Because young people need to know how much of their earnings each year are actually taken from them. Few teens that have part time jobs to pay for car insurance and a few pizzas each month realize that their parents must work from January one until May of each year to pay for the financial demands of government on them. Less and less of each paycheck actually belongs to Americans because of heavier tax demands and in order to ever get any of a lesser burden back, the next generations will have to throw off the repressive tax codes that take so much from each working American's pay check.
The fourth chapter in a school personal finance curriculum will need to discuss the importance of planning for the future. This chapter would probably include both an exhortation for a personal savings account as well as a stark look at life after the earnings years are over. One of the discussions in this chapter would hearken back to the magic of compound interest that can occur in a savings account. An example of a person saving ten percent of his income for thirty years could be spelled out showing what a modest five percent interest could earn that person over those years of faithful and disciplined saving. The other half of this chapter would exhort its young readers to imagine how much everything will cost when they are senior adults. How much they will need to live and what kind of a retirement program will need to be in place for their financial future to be secure will need to lead that part of the personal finance curriculum course discussion.
Of all the components going into a personal finance curriculum for school students, the most important would be the final chapter on understanding credit. With credit card and unsecured debt now over a trillion dollars and many people unable to make more than minimum payments on unsecured loans, the reality of credit card debt and the overarching effect debt can have on one's personal life should be the centerpiece of this last chapter. Issues such as what are a FICO score and the components that comprise it are extremely important for a young consumer to understand. Knowing the difference between the terms a bank can offer versus a loan company for a personal loan can be eye opening for a person who is not aware of how loans are originated. Jesus made it clear in His teachings that salvation and eternal life are certainly more valuable than any earthly possession. "Again, the kingdom of heaven is like unto treasure hid in a field; the which when a man hath found, he hideth and for joy thereof goeth and selleth all that he hath and buyeth that field." (Matthew 13:44)
In many schools, a class on personal finance is an elective. But many parents fail to teach their children about the importance of frugality, living within one's means and saving. In fact, sadly it is never even modeled by many families. Rather than hope some students take a course on personal finance, it ought to be a requirement. And by the way, maybe it shouldn't be the freshmen taking the course. They are usually a little too goofy for serious talk. Make it a junior class requirement. Seniors just want to graduate and get a credit card.