Teach me what an IRA is
Mike Jeffries: Muleskinner
Issue date: 11/20/08 Section: Voices
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'Money people' are everywhere these days. You've seen them. They are the ones who are always talking about how much money they make at work, or how much it costs to fill up their car, or how much their shirt was, or how expensive the bottle of wine was that they bought their dentist for Christmas last year.
The other day, one of my 'money people' friends kept throwing his frustration at his bank for charging him an overdraft fee.
"Well, did you overdraft your account," I asked.
"Well, yeah, but I thought I had more money in there. They have no right to charge me for that," he said.
Hey, mistakes happen to the best of us. But the fact is that we like to blame everybody but ourselves for our finance issues.
The problem is that we don't know enough about money. Ever heard of an exotic option or the Fair Credit Billing Act? How about a fixed income fund? Know what the current federal interest rate is? Know what the current interest rate on your credit card is? How about on your student loan?
It's your own fault you don't know enough about finances.
But it's not all your fault.
The lack of life skills education in the United States is a disgrace. The lack of life skills being taught at this University needs reform.
Here's the trouble: I had to take six hours of science credit plus a two-hour Biology lab, but nobody taught me how to balance a checkbook, or how much money to save in a 401K or what a hedge fund is.
In an era when social security is becoming a joke and bad loans are being handed out like free Krispy Kreme coupons, financial literacy is of utmost importance.
Take a look at the financial crisis that our new $700 billion rescue plan is supposed to fix. Sure those banks and lending institutions were scum, but a person's last line of defense should have been themselves.
But financial ignorance crippled them and might have broken our economy for years to come.
Did those people even know how an adjustable rate mortgage works?
It would be great if parents would teach their children about money and how it works, but face it, our parents don't know enough either. Our parents' generation is up to its neck in debt and isn't saving nearly enough for retirement.
The schools have to step in.
I'm not saying we need to take a three-hour course on personal finance - but we should all be required to take at least one. Instead, the University last year passed changes that lowered the amount of hours required for graduation. I don't understand this at all.
Instead of six hours of science, make us take five. So, for one semester, one day a week, we could learn the skills we will certainly need upon graduation.
I love chemistry as much as anybody - not at all - but it's past time we learned how to balance a checkbook instead of how to balance chemical equations.
The future of our country depends on it.
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