5 ms·

The US does a terrible job of inculcating basic financial literacy in the populace. The only way that paying someone 5% of assets / income just to avoid ruinat

The US does a terrible job of inculcating basic financial literacy in the populace. The only way that paying someone 5% of assets / income just to avoid ruination can be a sound investment is if the person is utterly clueless about how money in general, and compound interest in particular, works.

marvin 8y ago
That jumped out at me too, 5% for these incomes is an absurd number. Albeit worth it if the person is completely clueless.
- lagadu 8y ago
  From reading the article these aren't just accountants or financial managers: they're on call 24/7 and ready to handhold you through everything and seem to be willing to manage every aspect of your life that you throw at them (love life included, like mentioned in the article). Seems like it's a ton of work.
deleted 8y ago
[deleted]
Retric 8y ago
Depends on how much work these people put in. If they are going over every contract including insurance etc it would be an extremely valuable service. On to of that they are sorting all their mail, doing bill payments etc. 'I was at his house every single day, helping to oversee contractors, pick out windows, pick out drapes.'
- walshemj 8y ago
  I think she also meant but didn't say stopped contractors ripping her client off. Charging for Italian Marble but actually using crap materials or billing for more days worked than they did would be a couple of good examples.
  - saalweachter 8y ago
    Which might also indicate that good politics are a part of her job as well. You don't want to tell the contractors who aren't trying to rip you off "I need to stand here and stare at you so that you don't cheat me/steal anything", but if you're always around to help "pick out windows" or "choose drapes", you can keep an eye on things without being too obvious about it.
lentil_soup 8y ago
Not only the US. I've see that in many other places. Is there a place where financial literacy is part of school?
wastedhours 8y ago
Not only the US, but in a lot of places. A large number of these people will have been outside of the "real world" for a good proportion of their adult (and often, child) lives. Without comprehensive financial education early in schools, and with careers in industries detached from a lot of financial pressure, surrounded by hanger-ons and perceptions of lifestyle. I actually have a lot of empathy for these groups who see success but don't have the skillset to know what's best.
- ahartman00 8y ago
  "people will have been outside of the "real world"" This. I met a woman who was a nurse practitioner or something like that. She had a young boy and girl. Her plan was for them to be a pro football player and actress. So she would take them out of school to go to football or acting camp. She actively discouraged them from focusing on school. If these kids are successful, they will be lacking basic skills we take for granted. Think about the average person's understanding of math, and imagine someone actively discouraged from learning it. It could be tragic if they were successful, which is such an unreal thing to say. Even worse, the odds aren't good, and they don't have skills to fall back on.
  - FireBeyond 8y ago
    > Her plan was for them to be a pro football player The NBA has been trying to do a better job about educating people on the reality of professional sports. A lot (the vast majority) of people overestimate children / youth skill, especially parents. The NBA has been big on trying to encourage players even beginning to start college ball as taking college seriously, and by more than just empty words. Saying things like "There are 350+ NCAA basketball teams, each with a roster of up to 13 players. There are two draft rounds, 60 players. Even adjusting for four years of college players, there is less than a 3% chance you will be drafted to the NBA, even if you play college ball". There is even at high levels, a huge disparity of quality and talent. When I grew up in Australia, before refereeing basketball at a very high level, I was involved in cricket. I remember a promo event, where two international cricketers from India visited a local club. They faced off against the kids, and just hit balls around the field gently for them to run and get. Then they faced off against the state team. Every single ball was hit out of the park, without a hint of exaggeration. Some with a bounce or two, but every single one hit the fence. Fast, slow, good, bad, it didn't matter. It was just effortless. I think that did a lot to dawn on people who thought "My kid/adult son is playing at the state level, he could be like these guys one day". Maybe. But most likely not. So I do like that there is some (though not enough) effort at saying "Hey, you need a fallback, because you almost certainly will need it". Even earlier than college, if needed.

marvin 8y ago

That jumped out at me too, 5% for these incomes is an absurd number. Albeit worth it if the person is completely clueless.

lagadu 8y ago
From reading the article these aren't just accountants or financial managers: they're on call 24/7 and ready to handhold you through everything and seem to be willing to manage every aspect of your life that you throw at them (love life included, like mentioned in the article). Seems like it's a ton of work.

deleted 8y ago

[deleted]

Retric 8y ago

Depends on how much work these people put in. If they are going over every contract including insurance etc it would be an extremely valuable service. On to of that they are sorting all their mail, doing bill payments etc. 'I was at his house every single day, helping to oversee contractors, pick out windows, pick out drapes.'

walshemj 8y ago
I think she also meant but didn't say stopped contractors ripping her client off. Charging for Italian Marble but actually using crap materials or billing for more days worked than they did would be a couple of good examples.
- saalweachter 8y ago
  Which might also indicate that good politics are a part of her job as well. You don't want to tell the contractors who aren't trying to rip you off "I need to stand here and stare at you so that you don't cheat me/steal anything", but if you're always around to help "pick out windows" or "choose drapes", you can keep an eye on things without being too obvious about it.

lentil_soup 8y ago

Not only the US. I've see that in many other places. Is there a place where financial literacy is part of school?

wastedhours 8y ago

Not only the US, but in a lot of places. A large number of these people will have been outside of the "real world" for a good proportion of their adult (and often, child) lives. Without comprehensive financial education early in schools, and with careers in industries detached from a lot of financial pressure, surrounded by hanger-ons and perceptions of lifestyle. I actually have a lot of empathy for these groups who see success but don't have the skillset to know what's best.

ahartman00 8y ago
"people will have been outside of the "real world"" This. I met a woman who was a nurse practitioner or something like that. She had a young boy and girl. Her plan was for them to be a pro football player and actress. So she would take them out of school to go to football or acting camp. She actively discouraged them from focusing on school. If these kids are successful, they will be lacking basic skills we take for granted. Think about the average person's understanding of math, and imagine someone actively discouraged from learning it. It could be tragic if they were successful, which is such an unreal thing to say. Even worse, the odds aren't good, and they don't have skills to fall back on.
- FireBeyond 8y ago
  > Her plan was for them to be a pro football player The NBA has been trying to do a better job about educating people on the reality of professional sports. A lot (the vast majority) of people overestimate children / youth skill, especially parents. The NBA has been big on trying to encourage players even beginning to start college ball as taking college seriously, and by more than just empty words. Saying things like "There are 350+ NCAA basketball teams, each with a roster of up to 13 players. There are two draft rounds, 60 players. Even adjusting for four years of college players, there is less than a 3% chance you will be drafted to the NBA, even if you play college ball". There is even at high levels, a huge disparity of quality and talent. When I grew up in Australia, before refereeing basketball at a very high level, I was involved in cricket. I remember a promo event, where two international cricketers from India visited a local club. They faced off against the kids, and just hit balls around the field gently for them to run and get. Then they faced off against the state team. Every single ball was hit out of the park, without a hint of exaggeration. Some with a bounce or two, but every single one hit the fence. Fast, slow, good, bad, it didn't matter. It was just effortless. I think that did a lot to dawn on people who thought "My kid/adult son is playing at the state level, he could be like these guys one day". Maybe. But most likely not. So I do like that there is some (though not enough) effort at saying "Hey, you need a fallback, because you almost certainly will need it". Even earlier than college, if needed.