Sometimes I wonder why they don’t teach anything about personal finance in schools. With proper knowledge about personal finances, I wouldn’t have made some of the mistakes I made in my 20’s. I have said it a few times that if I had some level of education about personal finances earlier on in life, I would be in a better state financially. However, it is better late than never. Below are four finance topics I wish I learned in school.
Basic Investing
One of the four finance topics I wish I learned in school is investing. It is no surprise that only 55% of Americans invest in the stock market. That percentage could easily be close to 90% if investing is taught in schools. Many people shy away from it because they do not understand how to invest or are afraid to lose money. However, just as with anything else, with proper educational background, you can become an investor or hire a financial advisor.
According to the
federal reserve, 10% of Americans with the highest income owns 92% of stocks. Given that the S&P 500 has been reaching record highs, that means rich folks are getting richer. Much of what I know about investing is self-taught. I read many books, journals, listened to several finance podcasts, and documentaries to develop the investing knowledge I have now. Learning about the basics of investing earlier on in school would have made it better. It would have also resulted in starting right away and taking advantage of compound interest. It could also reduce the trend of people not saving enough for retirement.
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Loans
Another one of the four finance topics I wish I learned in school is taking loans. Many people take out a loan at some point in their lives. It could be a student, car, or home loan. All of these types of loans require proper education, otherwise, you may struggle to pay off the debt depending on the terms of the loans.
One of the first loans I took was for a college education, and I knew nothing about it. If I had learned something about it in school, I wouldn’t have taken an extra loan to fund my lifestyle outside of school. Even though the additional loan was needed, I may have taken out less if I knew all the consequences later in life. It is good to know how much you can afford. I believe that is the number one loan topic many people have in mind. Perhaps, our school systems can do a better job and start teaching these basics for a better future.
Credit Score
A credit score is another one of the four finance topics I wish I learned in school. Did you know a low
credit score can stop you from working at your dream job? Your credit score can impact your insurance rates, ability to rent an apartment and, your ability to take out extra loans for school for room and board. In graduate school, I received the most panicking email. The email stated that, due to my credit history, my graduate plus loan didn’t go through. Upon further investigation, I realized that I owed Verizon $37, and my account was taken to the collection agency, which negatively impacted my credit score. If I learned the importance of credit score in school, perhaps the scare wouldn’t have happened. I would have recognized to maintain a good credit score.
Negotiating
The last finance topic I wish I learned in school is the art of negotiating. You can negotiate with your spouse, kids, friends, and employers. One way to negotiate is with your spouse about when to make a big purchase, and how much to spend. You can also negotiate your salary before you start a new job, or to get a raise. Had I learned this in school, my overall salary since I started working would probably be higher.
Although there is a ton of information online to learn about personal finance, incorporating it into the school curriculums will have an impact on our finances. I could have avoided some of the struggles and mistakes earlier on in my life.
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