Money in Your Jeans

Making Sense Out Of Money

Posts Tagged ‘financial literacy’

It’s All Relative

February 8th, 2010

One of the hardest things to teach in financial literacy classes is the concept of needs and wants. Simply put, needs are what are required to survive: food, shelter, and clothing. Wants,on the other hand, are what one desires for ( e.g. I am hungry. I need food. I want a hamburger). The reason that this concept is hard to teach is that needs and wants are relative. What you spend money on life’s basics is dependent on your own financial situation. Teenagers have to understand that their wants are limited by the amount of money they have in their jeans. This leads to the topic of planning one’s purchases, which will be covered in my next blog.

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Posted in Learning About Money

Tags: financial literacy Financial Situation Needs and Wants

Your Kid’s Financial Well Being

January 6th, 2010

I’ve been away from this post for a little while – life got in the way. My Dad died in late November and quite frankly I just wasn’t in the mood to write. Since my Dad passed away I have been reflecting on his life. He was a good man who would help anyone in need, but he struggled financially. He left my Mom a wee bit of money, but not enough to live off of comfortably. The lesson to be learned is that one has to understand how money can impact one’s life.

I’ve decided that I’m going to help you help your child understand the importance of being financially literate. With that in mind, I will be tackling the following topics during 2010:

What is Financial Literacy?
The Difference Between Needs and Wants
Goal Setting
Earning Money
The Banking System
Saving Money
Investing
Any topics that you, the reader, want me to tackle…

Please bookmark this blog and check in on a regular basis so that we can both help your child understand how to manage money effectively.

My two cents worth…

The Money Professor

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Posted in Learning About Money

Tags: child financial literacy money Struggling Financially

Upset Financial Planners

November 12th, 2009

Well it looks like my last post got a few financial planners upset. What is sad is that they did not have the guts to post a comment on the blog. Rather they decided to lambaste me through another social media forum. I guess that I must have hit a nerve.
Please understand that I am not saying that financial planners are bad – some of my friends are financial planners. All that I’m saying is that some financial planners are more concerned about their bottom line. Obviously the more they sell the more they earn. When I was involved in the financial services industry I was paid $2200 for placing a $100,000 investment with one of our product providers. You do the math – a couple of deals like that a week ($100,000 investment loans were available to those that qualified) I would have a nice chunk of change in my jeans.
Planners will tell you that their job is to educate their clients. The question that you should ask is: what exactly are they teaching you? If you don’t understand what they are talking about hold on to your wallet and run like the wind! The worse investment is one that you do not understand.
My two cents worth…

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Posted in Learning About Money

Tags: financial literacy financial planners

Another Fine Mess You’ve Gotten Us Into Ollie!

November 11th, 2009

I am beginning to believe that one of the major reasons that the world is in the financial mess that it’s in is the very fact that most people have no clue how to manage their money. I’ve probably insulted a few of you by saying this, but quite frankly being ignorant about money has led us to the biggest financial disaster since the Great Depression.

Who is to blame? The financial industry has done a great job of feeding us doublespeak that most of us didn’t understand. We have been brought up to believe that financial institutions, and financial planners had our best interests at heart. Unfortunately, we failed to understand that the gooblygook that was being spouted by them was meant to make us believe that they knew what they were talking about. Boy did we ever get snookered!

Let me make something very clear – financial institutions are in the business to make money. A financial institution is nothing more than a store that offers financial products. The employee’s job is to sell you a product that may or may not fit your needs. Too many people are intimidated by this process and fail to understand what they are buying. This has been going on for ages. Most of us were never taught money management in school and most of our children will not be taught it either. It doesn’t surprise me that schools don’t teach students to be financially literate – most teachers that I have met are financially illiterate, so having them teach our kids would be like the blind leading the blind. I don’t trust most bankers or financial planners to teach our kids, because they see whoever is in front of them as a potential client – they just see dollar signs when they have a warm body in front of them (hmmmm….seems to be that this is one of the factors that led to the mortgage crisis in the USA; some brokers would arrange deals for clients as long as they could fog a mirror).

So who do you turn to? Parents you have to do your research. Find an organization that teaches basic money skills without pushing financial products.

My two cents worth…

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Posted in Learning About Money

Tags: child Education financial literacy financial planners money Parents school

H1N1

October 31st, 2009

I wear several hats: I am the president of Net Learning Solutions Inc, I am a husband, a dad, a son, a brother, and a junior high school teacher. At the school that I work at we have had a large number of students absent with flu-like symptoms. The absentee rate was close to 25% – this has an impact on teaching. It impacts those that teach only to the curriculum; those teachers will be in panic mode for the entire year, because they won’t be able to cover all of the required course material. Those of us who prefer to teach the child will have an easier time of it – yes the curriculum has to be covered, but I prefer to teach my students how to think; rather than memorize and regurgitate back what they have “learned”.

What does this have to do with financial literacy? Financial literacy is not about memorizing key concepts and doing math problems. Financial literacy is about using your brain and understanding how one’s actions has an impact on one’s personal situation. Financial literacy is about understanding how money works and encouraging behaviors that will keep money in your jeans. Simply put, financial literacy is learned by doing and reflecting on the consequences. So parents, financial literacy is not rocket science – it’s all about talking to your kids and imparting values that will help them to use money wisely.

My two cents worth,

The Money Professor

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Posted in Learning About Money

Tags: child Education financial literacy H1N1 money Parents school

Money Talk at the Kitchen Table

September 29th, 2009

I learned about money at the kitchen table. When I had a question about money – especially after I had started working part time in high school – I would sit down with my mom and dad and we would talk about what I needed to know . There was no set curriculum or lesson plan – my parents would do their best to help me understand how to apply money concepts to my particular situation. I wasn’t forced to sit through a boring math lesson on interest rates or rates of return; rather I got to learn about the stuff that impacted my life. This is what financial literacy is all about – learning and understanding how money concepts or strategies can be applied to your financial situation.

Parents, my advice to you is quite simple, take advantage of those teachable moments that might come about around the kitchen table. You don’t need to be a math wizard to teach your child money management; you just need to lend an ear and talk openly about responsible money management.

My two cents…

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Posted in Learning About Money

Tags: financial literacy Home Parents school

What Are Parents To Do?

September 6th, 2009

Teenagers often learn about money through trial and error – some will succeed, but the vast majority will struggle with debt unless they become financially literate.

What can you, as a parent, do to help your child acquire money management skills?

Start young: provide an allowance (it should be tied to simple chores around the house so that your child understands the link between work and money). Allow your child to make decisions on how to spend the money – try not to interfere; your role is to be the guide in your child’s decision making process.

Encourage your child to earn money either through part-time work on the weekends (as long as it doesn’t interfere with school work) or through summer employment. Have your child make a list of how much is earned per paycheque and his/her needs and wants. This will help your child understand that there are limits to what can be done with a finite amount of money.

Encourage your child to think about the future. How much will college, university, or trade school cost? What type of career to pursue? Career choice (and salary) will definitely affect one’s lifestyle.

Use the Internet as a research tool to learn about financial concepts, but be cautious. The internet can be compared to a massive library with millions upon millions of data. The search engine is the librarian of this massive library – and a very incompetent one at that, because it will return to you every related item that matches the search criteria. You will often have to sift through irrelevant data to find what you are looking for.

These tips are simple strategies that will help your child. However, money management concepts are complicated and most parents do not have all of the answers when it comes to this topic. Net Learning Solutions Inc. is in the process of putting together a parent’s guide for those interested in teaching their child money management strategies and concepts. More information to follow in the next few days.

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Posted in Learning About Money

Tags: allowance financial literacy Home Internet money Parents Part time school

Financial Literacy – Who is Responsible?

September 6th, 2009

Another school year is about to start. Kids will be learning reading, writing, and arithmetic, but sadly most will not learn the ins and outs of money management. Whose responsibility is it to teach our kids financial literacy? Parents? Teachers? Financial Planners? What do you think?