Financial Literacy: Whose Responsibility Is It?

Here we are already in April. The month is known for its Spring (and sometimes Winter) weather along with the pollen. Do you know what else April is known for? April is Financial Literacy Month, which was designated in the US in 2003. Financial literacy refers to a person’s knowledge of personal finances, money, and investing. To be financially literate means that you have the knowledge and skills necessary to make the best possible decisions in regards to your personal finances.

Honestly, we didn’t even know until recently that there was a financial literacy month, but considering how important finances are, it makes sense. However, many Americans aren’t financially literate and it left us thinking about whose responsibility is it to teach financial literacy?

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Kim’s Financial Literacy Background

I remember when I was a little kid and I would get money from someone. The first thing I would do with it was put it in my piggy bank or purse to save it. I always saved my money. So much so that my older brother would sometimes ask to borrow money from me and I’d make him promise to pay it back. And yes, he did. I didn’t play about my money even at a young age. Lol. I’m not sure where the habit of saving my money came from.

When I started working, eventually my mom took me to open my own checking and savings account. Most of my checks were deposited and I would have some money to spend. The money I was saving would eventually be used for things like prom, a car after I graduated high school, etc.

In high school, the most I remember about learning about money and finances is when I took Economics. It was a mandatory class. I remember helping classmates fill out (fake) checks because several of them didn’t know how. And I was shocked that they didn’t know how. And I also recall doing a project where we had to research an apartment to live in as well as figure out the other expenses. I didn’t get the grade I thought I would because the teacher said the food budget wasn’t realistic since I said would go to my parent’s house to eat. Lol.

Fast forward to college, and I finally got my first credit card to help build credit. And when my first car died, I took out a loan to get my next car. It was only $5100. I wanted to pay it off early, but once I started nursing school, I couldn’t work as much. So I only ended up paying it off 6 months early (and then it died too). Speaking of nursing school, this is where I racked up the most debt. Student loans of course.

I wrote an entire series about this actually:

• How I Chose My College Major
• Why I Didn’t Mind Paying Back My Student Loans
• How I Paid Off $36,500 Of Student Loan Debt
• Why You Should Save For Your Child’s College Education

In college, I didn’t learn anything about personal finance, money, or debt. I do recall receiving the promissory note for my student loans and realizing that I had 6 months after graduation before I had to start repaying them.

Overall, I don’t recall having any sit-down conversations with my parents about money. It was always random like, “Let me show you how to fill out a check. If you get a credit card make sure you pay it off. We’re going to try to avoid student loans.” Or on the other hand, I learned what not to do. And this isn’t to place blame on parents. Besides, whose mistakes better to learn from than someone else’s? Looking back on it, eventually, I learned that I need to make sure that I pay off my debt, have some money in my savings account, save enough for retirement and something for my kids’ college, and I need to enjoy my money as well.

Omar’s Financial Literacy Background

I grew up in a middle-class home like most Americans. The general tone of money around our household was that money didn’t grow on trees. I remember my parents doing a lot of the work on our house – painting, carpentry, laying tile. They weren’t afraid to try to fix stuff on their own. I’m sure part of the reason they did this was to cut down on costs.

One thing I can say and am grateful for is that we never missed a meal. I have friends that are teachers and even they are blown away by the number of students that come to school hungry. Being the youngest I got all the hand-me-downs. And trust me, they looked like hand me downs. My school mates had no problem letting me know. It was painful at the time, but looking back I don’t think I would change it. To get over that I had to develop a tough skin and it taught me not to give a @4#% about what people think about my material possessions – a trait that has been extremely helpful in our wealth building process.

The other thing I remember was how much work we did around the house. During the summer we had to cut the grass like twice a week. In the fall we had to rake the leaves and keep the gutters clean. Saturday was clean the whole damn house day. Fold up your clothes, spread your bed, wipe down everything.

When I got a little older the church we went to sat on at least two acres of land that could be mowed. At age 15 or 16 I was cutting the whole church lawn using a commercial mower. The idea that money comes from work is missed by some folks. I’ve never been afraid to work and that has definitely helped in my financial journey.

Like Kim, my mom took me to the bank to open up a savings and checking account. I think I might have been in my mid-teens when she did this. Although it was Kim that showed me how to fill out a check. I don’t know where I got it from, but I’ve always been a natural saver. In college, while working at UPS, I consistently had between 1k and 2k in savings.

Again, like Kim, I don’t remember having any sit-down conversations with my parents either. The one thing I do vividly recall is when my dad introduced me to this country ass white guy on the radio named Dave Ramsey. That’s where my financial education started. I’m definitely grateful for that as well.

Whose Responsibility Is It?

While neither of us learned much about personal finances from our parents, it was evident that they taught us what they knew for the most part. And we’re forever grateful for that. However, we still believe that financial literacy starts at home. Parents are a child’s first teacher. So who better to teach a child than his parents? And even if you don’t know much about personal finances, it’s never too late start.

With that being said, we also feel that it would be nice if high schools and colleges taught more about personal finances as well. We spend a good chunk of our lives in the education system so why not learn some more useful life skills? We know that it can be easier said than done, especially depending on what is selected to be taught.

How We Plan To Teach Our Kids To Be Financially Literate

We’ve already started teaching our oldest son some of the concepts of money. He will be our guinea pig since he’s the firstborn. That seems to come with the territory that we don’t know much about because we’re both the babies of our families. Lol. But on a more serious note, he’s currently 4-years-old and at times we already see glimpses of him not understanding the concept of money and where it comes from. Not to mention how we have to work for it to be able to buy things and buy him things.

Currently, we will give him a dollar or two to clean up his toys in the basement. Not always, but sometimes if we know we’re going to a store where he might find a toy. Once we go to the store and he finds something, we will let him hand the cashier the money and make sure he waits for his change and receipt. And we make sure he says, “Thank you,” as manners are important in this process as well.

The part that we don’t really like about this process is that neither of us was raised receiving an allowance, especially not for things that we were supposed to do anyway. So we definitely need to figure out something else that is age-appropriate that we can pay him to do so that he can earn money.

Other than this, we’re not really sure what else to do to facilitate his learning at this young age. So we ordered the Financial Peace Jr Kit. It’s a kit by Dave Ramsey for kids ages 3-12 designed to help parents teach their kids about money. Once we use it for a while, we’ll check back in to let you know how we like it or not.

Final Thoughts

Financial literacy takes a village. No one should have to go it alone, whether they’re young or old. There are all types of information online as well as in books. And there might even be people open and willing to discuss their wins and failures with you as well. Although financial literacy should start at home, once a person is an adult, there is no excuse to be financially illiterate. Ignorance is not bliss; it’s costly.

What are your thoughts on financial literacy and whose responsibility is it? Let us know what you think!

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