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OK. So you're educated about finance. But personal finance is mostly about personal habits and actions. You can understand what is a financially sound plan of

by kiba 5y ago

OK. So you're educated about finance. But personal finance is mostly about personal habits and actions. You can understand what is a financially sound plan of action all you want. For example, I wasted money on eating out three times last week, whereas previously I only eat out once per week successfully for weeks on end. Information is insufficient. Practice is required. I am unsure exactly what information these firms provided. Even if it's sound information, it doesn't necessary translate to practice.

kafkaIncarnate 5y ago
That's literally what my personal finance class taught in high school as a part of the government mandated financial literacy class. How to budget. Why to budget. How to write a check. What is a bank account? How to open a bank account. What food costs. What does produce cost? Compare that to X restaurant. What are good ways to save money? What are the costs of renting vs owning, etc. This wasn't a "stock market" class, though they briefly covered business and what a stock/investing was.
- kiba 5y ago
  They are useful information. For a lot of people, that's great. But it is not the same thing as practice, as in actually doing the work of saving and resisting temptation such as eating out.
  - enkid 5y ago
    But it is a prerequisite.
  - kafkaIncarnate 5y ago
    Okay I understand what you're saying, but I'm not sure why this is being used as an argument against teaching personal finance... Academic vs. real life is a strange debate to me. It seems that to some people that academics itself is sacrosanct and plenty, and to others real life is sacrosanct and plenty. This entire article is about academic data being sacrosanct about these classes, and that's literally what I railed against. To me, I believe in both. They go hand in hand. So for instance, if you're talking about the action of cooking, I also was required to take a Home Ec class independently of the personal finance requirement. There are many requirements in a high school, this is just one class we are talking about. The Home Ec class had grades based on how well we would sew up and patch clothing, create pillows and such, and cook various things. So there's some practical experience. Now, you're also debating about an essentially real world "resisting" of urges and that's clearly not going to be able to be "taught" as you say. But we're talking about preparing children for adulthood, and in adulthood, you're going to experience that either way. If they don't know what the term "interest rate" is, how exactly are they going to learn it from a 10+ page credit card legalese document? That seems enormously more opaque to me. You can learn it from others, sure, but they had to learn it somewhere and they likely learned it from a book or from school, or from learning it by screwing up the hard way. If we're trying to reduce the amount of people that long term screw up, then having them equipped to understand the language of the real world is a great place to start instead of at the ground floor with zero knowledge. And yes, real world experience is necessary, too, but short of giving kids raw eggs and meat and having thousands of stoves in the lunchroom instead of prepared food I'm not sure how you would accomplish that. Some people are privileged enough to have parents that can teach them this stuff, but largely after generations of not knowing these things in impoverished areas or having parents that have to work to do the things like cook for their children and pay their own bills when they get home, those fresh "graduates" are going to start from scratch not knowing the language nor having the experience and wind up screwing up, possibly in a way that is impossible to get out of and end up homeless or buried in extreme debt with interest rates they do not understand. Increasing the odds of your success by helping you understand the terms being thrown at you is going to help prevent that. As is having you go through the motions of doing the cooking, in this example. But it comes down to for me as I said, I believe in real world experience AND education on a subject. Education can teach you what you need to practice in the first place sometimes, rather than end up unable to understand why you are trapped and what could potentially help you become untrapped. I don't see these as mutually exclusive.
  - tedunangst 5y ago
    Will people do a better job of saving money and resisting temptation if we never teach them why that's important?
b3morales 5y ago
> I wasted money on eating out three times last week Was it definitely a waste? The time you spend preparing your own food has value. As does the mental impact of (depending what you bought) the pleasure of a meal you could not have made for yourself; and the relief of pressure of not having to do it yourself.
- inglor_cz 5y ago
  It is worth trying, though. Some people find out that cooking gives them more pleasure than waiting for their order to arrive.
  - avalys 5y ago
    Yes, this is called “people who enjoy cooking”.
    - inglor_cz 5y ago
      True, but in order to find out if that is your case, you must try it out, and probably more than once. Most hobbies aren't immediately awesome, a certain section of the learning curve must be climbed. I still remember my silent desperation when I sat in front of a PC back in 1994 for the first time. Computers were totally alien to me at that time. Ten years later I was programming in several languages.
  - b3morales 5y ago
    Personally, I enjoy both, equally, at different times.
JumpCrisscross 5y ago
> personal finance is mostly about personal habits and actions It’s also about common knowledge and frameworks. Knowing you should not have to pay to maintain a checking account, for instance. Or that filing a tax return can produce a refund. How to pay down debt when you have spare cash and different types of debt, or how to compare two purchasing options—a monthly or an up front.

by kiba 5y ago

kafkaIncarnate 5y ago

That's literally what my personal finance class taught in high school as a part of the government mandated financial literacy class. How to budget. Why to budget. How to write a check. What is a bank account? How to open a bank account. What food costs. What does produce cost? Compare that to X restaurant. What are good ways to save money? What are the costs of renting vs owning, etc. This wasn't a "stock market" class, though they briefly covered business and what a stock/investing was.

kiba 5y ago
They are useful information. For a lot of people, that's great. But it is not the same thing as practice, as in actually doing the work of saving and resisting temptation such as eating out.
- enkid 5y ago
  But it is a prerequisite.
- kafkaIncarnate 5y ago
  Okay I understand what you're saying, but I'm not sure why this is being used as an argument against teaching personal finance... Academic vs. real life is a strange debate to me. It seems that to some people that academics itself is sacrosanct and plenty, and to others real life is sacrosanct and plenty. This entire article is about academic data being sacrosanct about these classes, and that's literally what I railed against. To me, I believe in both. They go hand in hand. So for instance, if you're talking about the action of cooking, I also was required to take a Home Ec class independently of the personal finance requirement. There are many requirements in a high school, this is just one class we are talking about. The Home Ec class had grades based on how well we would sew up and patch clothing, create pillows and such, and cook various things. So there's some practical experience. Now, you're also debating about an essentially real world "resisting" of urges and that's clearly not going to be able to be "taught" as you say. But we're talking about preparing children for adulthood, and in adulthood, you're going to experience that either way. If they don't know what the term "interest rate" is, how exactly are they going to learn it from a 10+ page credit card legalese document? That seems enormously more opaque to me. You can learn it from others, sure, but they had to learn it somewhere and they likely learned it from a book or from school, or from learning it by screwing up the hard way. If we're trying to reduce the amount of people that long term screw up, then having them equipped to understand the language of the real world is a great place to start instead of at the ground floor with zero knowledge. And yes, real world experience is necessary, too, but short of giving kids raw eggs and meat and having thousands of stoves in the lunchroom instead of prepared food I'm not sure how you would accomplish that. Some people are privileged enough to have parents that can teach them this stuff, but largely after generations of not knowing these things in impoverished areas or having parents that have to work to do the things like cook for their children and pay their own bills when they get home, those fresh "graduates" are going to start from scratch not knowing the language nor having the experience and wind up screwing up, possibly in a way that is impossible to get out of and end up homeless or buried in extreme debt with interest rates they do not understand. Increasing the odds of your success by helping you understand the terms being thrown at you is going to help prevent that. As is having you go through the motions of doing the cooking, in this example. But it comes down to for me as I said, I believe in real world experience AND education on a subject. Education can teach you what you need to practice in the first place sometimes, rather than end up unable to understand why you are trapped and what could potentially help you become untrapped. I don't see these as mutually exclusive.
- tedunangst 5y ago
  Will people do a better job of saving money and resisting temptation if we never teach them why that's important?

b3morales 5y ago

> I wasted money on eating out three times last week Was it definitely a waste? The time you spend preparing your own food has value. As does the mental impact of (depending what you bought) the pleasure of a meal you could not have made for yourself; and the relief of pressure of not having to do it yourself.

inglor_cz 5y ago
It is worth trying, though. Some people find out that cooking gives them more pleasure than waiting for their order to arrive.
- avalys 5y ago
  Yes, this is called “people who enjoy cooking”.
  - inglor_cz 5y ago
    True, but in order to find out if that is your case, you must try it out, and probably more than once. Most hobbies aren't immediately awesome, a certain section of the learning curve must be climbed. I still remember my silent desperation when I sat in front of a PC back in 1994 for the first time. Computers were totally alien to me at that time. Ten years later I was programming in several languages.
- b3morales 5y ago
  Personally, I enjoy both, equally, at different times.

JumpCrisscross 5y ago

> personal finance is mostly about personal habits and actions It’s also about common knowledge and frameworks. Knowing you should not have to pay to maintain a checking account, for instance. Or that filing a tax return can produce a refund. How to pay down debt when you have spare cash and different types of debt, or how to compare two purchasing options—a monthly or an up front.