Parenthood | Brandon Coppernoll

6Feb/091

How should we teach our kids about finances?

This is a hot button of mine because I think we really need to include more financial education to our children, but unfortunately I don't know if I trust those that would teach it.

I recently read an article by Wish TV, and at first I was on board with what they wanted to do. The goal is simple. Educate our children about finances so that maybe they will be able to live financially successful lives. That sounds good on paper, but here's my dilemma.

The majority of adults are complete idiots when it comes to finances. I'm willing to bet that most teachers in middle and high schools would not be in the position to teach sound financial topics to give our kids the best possible shot.

Here's one of the many reasons we are in a recession. It's also one of the contributing factors to rampant debt to credit card companies and many foreclosures across the nation.

"Mr. Jones runs up $20,000 in credit card debt. He can't make all the payments. He has $20,000 in equity in his home. He consolidates all the debt using the equity in his home to be able to make payments, but within the next year he has run up another $5,000 in credit card debt."

What's wrong with this picture? Sure he consolidated so he could have more money at the end of the month to make payments on that debt, but he goes right back to the reason he needed to consolidate in the first place by spending money he doesn't have via credit cards! This happens far too often. I have seen friends and family do this, and it really does cause a lot of issues.

I'm all for consolidating your bills if that's what you need to do to make payments, but if you're going to do it then you must change your spending habits. If credit cards got you into the mess you're in then you may want to change how you use them.

I am no financial expert, but I've learned through some mistakes of my own to not spend money I don't have. I only recently paid off my credit cards. My wife and I are doing everything we can to not spend any more money using those cards. If we can't pay off what we put on the card by the end of the month then we don't use the card.

If we institute financial education in our schools, I propose we "hire" wealthy individuals that can teach the subject. I do mean wealthy, not rich. I believe there's a difference. A lottery winner can become rich, but she can still blow all the winnings away. A wealthy person may or may not be rich, but if they lost a source of income they would be okay because they can last a long time due to the wealth they've built.

I hope if we do institute a program we find the qualified individuals. In the meantime, I'm going to keep learning, growing and working to better my financial plan and do the best I can to teach my children what I've learned. At times - the hard way.