It’s finally beginning to make sense. One mother, in total frustration, threw her hands up and told her daughter she’d hire her a tutor to help with her calculus this past semester. “She understands it far better than I do, but it can still get a bit overwhelming for her, so I figured it was time to bring in a tutor since she’ll be applying for college next year.” Makes sense, right? As parents, we all want our little ones to ace their educational pursuits. And then, Mom said an epiphany hit her like a ton of bricks.
I asked Maddie to let’s go over her checkbook last week. I just wanted to be sure she’d deducted her deposit onto the prepaid American Express her father had put in place for her.
What she got instead was a wake up call when her daughter reluctantly dropped her checkbook onto the dining table. “That child hadn’t deducted the first check from her balance!” What mom said next was slightly humorous, but most certainly a truth many parents can relate to:
Suddenly, I thought to myself, all of those times I heard, ‘Why do I need calculus? I’ll never use it in the real world’ made sense to me. My daughter could work out those complicated formulas better than she can keep a running total in her checkbook.
And therein lies the problem many parents face – their little ones are being taught advanced math courses, and have no idea how to balance a checkbook or how the stock market works.
That, unfortunately, is a truth in American culture. We want those college applications to be impressive, but there’s not a single one that requires an applicant to prove she can keep a running, accurate total that you’d find in a basic checkbook register. They have no idea how a credit card’s APR works, how microeconomics work or how that Dow ticker affects their financial futures. That could be changing, though – and Maddie’s mother says it’s not a moment too soon.
Many high schools are looking for ways to have basic financial classes added to their curriculum, but parents aren’t waiting on that. The recent recession and difficult economic times have taught parents that it’s up to them to ensure their children are getting those financial basics at home, especially if they’re not being taught those basics in the classroom.
The state of Missouri has recognized the problem, too. It now requires a money management and personal finance course before high school seniors can graduate. It’s a one semester course, though the state offers what it calls an accelerated class that can be taken during the summer months and in an online environment. The course delves into those basic need to know dynamics, such as banking, how to use credit cards wisely and simple money management skills that can help young people better budget their finances. Not only that, but it even focuses on teaching these high school kids the importance of saving for college, their first homes and the importance of strong credit scores.
The courses incorporate real world simulations designed to lead them to “practical decisions” when it comes to money. So involved is it that students go to a car dealership, choose their vehicle of choice and then research what would be a fair price. They must demonstrate an ability to calculate the estimated personal property and sales taxes. Sounds great, right? The question then becomes: why isn’t every state demanding this type of course?
The materials are inexpensive, as evidenced by Missouri’s price tag, there are no text books and the costs of the classes aren’t even on the shoulders of the taxpayers, but rather, the Missouri Council on Economic Education provides support to teachers, supplying them with lesson plans and other materials. A textbook makes little sense anyway since the information becomes antiquated as soon as it’s published; the economy is never certain and the new financial laws also continue to emerge as well. Teachers are empowered to create the pace and program since there’s so much to work with. It’s proven to be invaluable for students.
Students report the skills they learn aren’t likely ones their parents could have taught them. Some say mom and dad are working while others say it’s simply a taboo topic in their homes; remnants likely of the way their parents were raised when money wasn’t discussed within earshot of kids.
Now, Missouri is raising the bar – it’s offering personal finance competitions for students. The National Personal Finance Challenge is exactly what builds the confidence of these young people – and it’s working well. The students commit to meeting once or twice a week to prepare for the contest, which builds confidence, too. The questions run the gamut: What is considered an excellent credit score? Is a consumer’s employment history a factor in how their credit scores are calculated? What is PMI? Teachers report the confidence that’s built in these kids is there to stay; the tools are life long and give the kids something to build on as they move to college and adulthood.
Many are saying these courses should be introduced even before high school. At any rate, as Maddie settled in for a long afternoon of addition and subtraction with Mom, there’s a movement that’s quietly taking place and while it might have begun with Missouri, ideally, it will be a part of every school system in the country and sooner rather than later.