Teens and financial knowledge

Discussion in 'Money Management & Banking' started by Kelvin Cunnington, 21st Nov, 2019.

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  1. Kelvin Cunnington

    Kelvin Cunnington Well-Known Member

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    Not sure if this is the right section for this.
    A post on another thread reminded of a discussion I had with my now 18 year old son - about a year ago.
    He has a decent level of financial intelligence due to my wife and I trying to educate him over the years.
    Has decent savings, understands delayed gratification (still ffinds it hard to do) etc.
    We were discussing his first future property purchase, loan types, depost, interest and so on.
    We were showing him a basic Mortgage Calculator on one of tbe websites, and when we pointed out what happens to the Loan when you switch from monthly repayments to weekly, and add a little bit more over and above the minimum repayment as well - it blew his mind.
    Now; given he has a little bit more awareness already than the average self-absorbed "I want it now" teenager; imagine how many kids have very little knowledge of basic stuff like this?
    It is sad that these sorts of things are not being taught in school.
     
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  2. SatayKing

    SatayKing Well-Known Member

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    It is still all about ME!
    I take your point. However, the current wishes of what schools should do is chock a block with the wants and needs of many interest groups plus how many of those that teach have any level of competence in these matters?
     
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  3. Kelvin Cunnington

    Kelvin Cunnington Well-Known Member

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    Correct; I suspect there are not many teachers who are overly financially intelligent themselves. No doubt very knowledgeable in their chosen Academic subjects to teach.
    I wonder how it would be received by the School if a parent - who has had a good amount of experience on the ground, and some reasonable success from nothing - were to approach the school to run informal Classes for say; Year 9 upwards on "Financial Intelligence 101"?
    Probably no hope unless you had some sort of qual after your name - which is narrow minded; given what we all know here.
    Personally, I think kids would respond far better to the Dad or Mum who was poor and broke at their same age, left school and became successful - portraying themselves as a pretty "normal" person who acquired a bit of basic knowledge, applied it and waited.
    An expert in a suit would probably not connect as well.
    A tradie Dad, a paramedic Dad or Mum, dressed in casual gear, or a Mum with a home-based business and 3 investment properties, etc dressed in casual gear - would probably grab their attention a lot better, I think.
     
  4. Scott No Mates

    Scott No Mates Well-Known Member

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    • Professional indemnity insurance
    • Working with children check
    • Financial services licence
    That probably doesn't even scratch the surface.
     
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  5. Darwin55

    Darwin55 Well-Known Member

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    Yes, I wish I had learned about finance, property, tax etc in school.
     
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  6. Lindsay_W

    Lindsay_W Well-Known Member

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    It's a good point and hindsight is a wonderful thing, easy to say 'I wish I had learned that' when you're a grown adult looking back.
    Personally I think that even if this stuff was taught in school not many kids would be interested. How many people straight out of high school 1. have the capacity to borrow for a home loan or 2. want to get into debt straight away? Other things are a priority at that age, well for me they were anyway.
     
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  7. willair

    willair Well-Known Member Premium Member

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    You only get a very small time-frame with financially education with children from when they need all the care required till the batton is passed on and they run their own race..

    As most within this site would know who have raised their family in this country ,it's starts at home what they see what's talked about around the dinner table each night and how to learn the skills to spy an opportunity ..

    Your idea on the internal school education is a good ,the CBA when i was at school from memory would come out and give a money tin shaped like a bank open your account that where it started for me and that money tin idea has worked very well for me..
    upload_2019-11-21_8-51-41.jpeg

    Buts that's a long time ago,we now live in a world where newspapers are literally yesterdays news and we have layers of bureaucracy that have developed over the decades some good some useless..imho..
     
  8. Kelvin Cunnington

    Kelvin Cunnington Well-Known Member

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    True.
    But at least they have had the opportunity to be shown what is achievable - and more importantly; not overly difficult to achieve with the right knowledge.
    My son at aged 17 formulated his plan. He might not realise his first property until into his mid-twenties, but he sees what can happen now.
    Currently, a lot of teenagers are being told terrible things about the future, and are believing it. They feel there is less hope for them.
    Having the knowledge might provide the catalyst for them to formulate a plan, a path and a goal of hope; not despair, and a "hate the rich" culture.
    Many teenagers dont see how the majority of people became rich; they just see the end result, and think they fell into it.
     
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  9. Kelvin Cunnington

    Kelvin Cunnington Well-Known Member

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    Its a starting point, I agree.
    Being told by a Bank to save money with a Bank - their Bank - is not financial education, if you ask me.
    They never talk about "IRR", or "DSR" or "tax on interest" or "weekly repayments", etc.
     
  10. Kelvin Cunnington

    Kelvin Cunnington Well-Known Member

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    Yeah; crippled by bureaucracy right there.
    The whole point would be to make it informal, casual, taught by real people they can relate to, fun, an optional Class.
     
  11. Lacrim

    Lacrim Well-Known Member

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    I remember learning about NPV, IRR, P&I, assets and liabilities, cashflow statements, EBITDA, stock valuation etc at Uni as part of my course...went in one year out the other. Zero interest apart from learning the theory so I could pass the exams.

    I think adulthood, maturity and having to fend for yourself is what sparks the renewed interest in the subject matter bc when financial illiteracy hits your hip pocket.....that's when you start seeking out info. And that's adults. (Most) kids/teens wouldn't give a flying f.

    The trick for learning the curriculum in school is combining the 101 teachings on budgeting, home loans etc with having to open up a savings acct and contribute to it and/or invest in the stockmarket. When they start seeing the money grow....
     
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  12. willair

    willair Well-Known Member Premium Member

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    Truth is ,it built a trust between that money tin and the future..

    But i just have to ask ,why by giving away a money tin and watch your saving grow over time and spending your entire life building everything up from a simple tin..
     
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  13. Trainee

    Trainee Well-Known Member

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    Do schools teach how to play fortnite?

    If you want to learn, the resources are there.

    before internet, there were (still are) libraries.
     
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  14. Kelvin Cunnington

    Kelvin Cunnington Well-Known Member

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    I agree, but if we are sending our kids to school (as I am - and to a Private school to the tune of $10k per year), then it makes sense to me they teach them a few useful subjects as well to improve their financial lives - and their families' lives.
    More "Life skills" subjects - it can be an optional Class.
    Kids regard half their subjects as a total waste of time as it is.
     
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  15. TAJ

    TAJ Well-Known Member

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    Most of my financial knowledge was gained through heeding information passed down from my Dad. A sprinkling came from studying commerce and economics at school.
    It would be a real benefit to "Teens" if an easy to understand lecture could be delivered to them encapsulating the positive outcomes that can be derived from simple money management. Even if it only gets through to a few it is still a win for society.
    You can lead a horse to water, but you can't make it drink, springs to mind!
     
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  16. The Y-man

    The Y-man Moderator Staff Member

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  17. The Y-man

    The Y-man Moderator Staff Member

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    I had similar thoughts (as I deal with the "next stage" as a uni tutor) ~~ trying to avoid the regs and stuff by having people do "what I did" rather than a "what you should do" capacity.... and not people with formal quals but pitch it as an "hour with a multi-millionaire" sort of thing (your street cred goes out the window first minute when you rock up in a 2006 Mazda 2.... but that's the important first lesson ;)).

    The Y-man
     
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  18. The Y-man

    The Y-man Moderator Staff Member

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    I used to speak at careers nights at my old high school - never got invited back..... probably after I said something along the lines of "if you want your kids to make money, forget medicine and law - go become plumber or sparky...." (the school has a lot of high academic performance orientated Asian families ~~ you could see the horror on their faces :D:D:D junior don't listen to that crazy man....!!)

    The Y-man
     
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  19. Kelvin Cunnington

    Kelvin Cunnington Well-Known Member

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    pretty good program; great resource - but still misses the "real person' mark I have in my mind for the High School Classroom - it comes across as formal, boring, stiff, and definitely Government.
    A good analogy would be like when we had the visits to the school by the Police, or Fire Brigade, etc.
    The kids felt a connection due to direct contact with them, rather than watching a video documentary, or a website, etc about what they do in their job.
    For example; that little chat with my boy about the Loan calculator at the dinner table, versus his formal economics curriculum classes at school.
     
  20. Phar Lap

    Phar Lap Well-Known Member

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    My financial (successful) tutoring came directly from Jan Somers books!
    It was after I read the first book I snapped it shut and said "why dont they teach this stuff in school"

    My parents, 1920's born, wouldnt borrow money for anything.
    never really had any "success" financially until they went into business of their own quite late in life. Even then they still didnt know much about investing other than term deposits. Made enough to retire to a house on the coast but still received the pension as not much cash in the bank.

    When we started buying properties with much borrowed money they were horrified.
    But after a few years they could see we were making a go of it having had educated ourselves appropriately.
    Wifes parents had no idea about investing either. My FIL's idea of investing was on race 3 no 6 at Rosehill !

    Its a hard one to introduce to school but it would definitely need to have a "hands on" example approach. Start in year 7 with basics of saving, show how it grows, the power of compound etc then each year introduce alternative investments along with education on obtaining funding, how to be tax effective etc etc.
    Hopefully by year 12 students could have a real and tangible sum/portfolio to show for all the learning over the years. Its imperative also to teach children how to spend/budget with an income well before they earn one after leaving school.
     
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