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I worked my way through college. If my kids try to do the same it will take them more than 14 years if they match my work.

The snow you walked uphill both ways in wasn't as deep as you think.

I did too, but I left university, and did pretty good for myself despite that decision.

University is a choice unless you need the paper to be a doctor, engineer or lawyer, or other 'professional'. I personally do not subscribe to the public education system. I am home schooling my youngest here in East Java. My eldest sone is studying German, and thinking on going to Germany for university, which is very cheap even for foreigners. My daughter goes to an affordable college.

The days of elite universities and Ivy league tuition are numbered. I had the joy of somebody I met traveling telling me how much debt he had to send his son to Cornell. I simply said why not a more affordable school, to which he replied, "Because you know your kid is set for life with that piece of paper no matter how he performs as long as he graduates." I am almost gagged.

It's elitist attitudes like that I disdain, and frankly, I don't think the programs vary in proportion to the cash outlay and debt for life. I like the 'if you landed on a deserted island who would you want with you', and by that metric, I am very confident in my son, not so much in the elitist's son.

I am not sure how to take your 'snow' comment, since that comes from a comedy routine, and yes, I understand its take on hyperbole. But I can pretty much guess you cannot speak to how deep or inclined the snow was for me ;)

The problem is that the ivy league elitists control access to most of the best jobs.

Resumes from the affordable school your daughter is attending are quickly filed in the round bin.

The quality of education doesn't actually vary much, but the quality of the contacts and the doors opened is greatly improved by more prestigious schools.

The US job market is just much more competitive now than when you were young. Look at the numbers. There are about 4.5 million 22 year olds in the US. There are over 1 million new legal immigrants each year.

Basically entry level jobs are flooded. And jumping career tracks is far more difficult than you think, HR departments aren't huge believers in IQ or transferable skills.

A bad school can lead to a bad job track, and that can lead to a life long struggle.

I have jumped outside that track, and it is what I am teaching my kids to think about. What best jobs? What does it mean to be successful? I have far less money than some of my peers, but they envy my lifestyle of living minimally and in different countries. It all depends on what your goals are, and what group you run with I guess. I say question your assumptions.

As far as being more competitive, I don't buy it. 1 million, 1 billion, if you truly have common sense and some intellect, you beat out 99% of those numbers, and the common sense doesn't seemed to have scaled to make the population that now enters the market any more difficult, but that is purely limited empirical obsevation on my part.

BTW, I am still in the job market, so I am familiar with how competitive it is, and I don't rely on just established connections. I venture out of my comfort zone often. From programming, to diving to maintain and fix electrical and hydralic systems underwater, to managing installations and subsequent operations of a few world-class installations of unique equipment, and an odd assortment of other skills.

And, I did it without completing a degree.

See that was my attempt at putting me CV out there ;)

Yeah. I think it's a huge issue when people romanticize the hard work they have done in the past and expect the same from their children. It's one thing to say "my kid should be financially literate" and another thing to say "I sweeped floors at a supermarket when I was a teenager and so should my kid."

IMO our goal should be to make life better for our children, and that involves giving them opportunities and resources so that they don't have to work as hard as us, unless they absolutely have to. My dad worked through college, but paid for my college so that I could focus on my studies. I plan to do even more for my own kids in the future, maybe by paying for their grad schools as well.

I think what GP was trying to mention is that the cost of things like college have gone up immensely since then. The same strategies won't work now.

You can't live on a minimum wage job in most places in the US, let alone live + pay for school

You misread me. I don't expect my son or other children to work sweeping floors or otherwise. Each generation of my family has improved life for the next generation. From my Momo, grandma, coming over as a cleaning lady for New Yorkers, to my Dad driving a truck or other such job.

I worked through college, but dropped out voluntarily. I think there are other opportunities to learn nowadays aside from university and graduate school unless you want to be a doctor, engineer, or lawyer.

My son and daughter volunteer and work and go to school. They are both doing exceptional. My son was number one in the entire county in Chemistry this past year. I am split on whether they would be better off not working or volunteering at all. It is their choice; I didn't ask it of them. I did offer them the option of focusing solely on studies, but they like what they do. What can I say?

I have friends whose kids are given whatever they please. These are not friends who grew up where or how I did. Their kids are having all sorts of serious adaptation issues. I think it is due to having too much time and no responsibility. I work hard at my art and job, no romanticizing here. The drunk writer, or coder who just wings it, are stereotypes. The real achievers work their ass off.

I know from being a manager of hundreds, and including myself, that busy people seem to get more work done. I am not talking about the culture of no sleep, 75 hours per week. I am talking about having 30 hours of real work per week in a 40 hour week, and not 10 hours and making up for the deficit in a 75 hour week, which seems common in some companies.

Financial numeracy is definitely an issue which should be focused on. There was a story recently by the local NPR station where an organization which was teaching people new to the workforce about savings accounts, etc., found that many people used payday loans and were basically giving 30% - 40% or so of their paycheck to these high interest loan places because they just didn't know how to use a bank and set-up a savings account. These people just didn't have a better example to follow --their friends and mates had done the same so they just followed not knowing there are alternatives.

In many places, financial institutions like banks do not serve the poor. Like, in the US if you are a poor minority living in an area heavy in poor minorities, it is quite likely that banks will essentially refuse to serve you. Redlining was an example of this kind of thing. There are other, related things - low balance fees, minimum transaction sizes, the need for proof of income or a guarantor who can provide such. This is why cheque cashing places still exist in 2016 in the US - for many people, they literally will be refused service if they try to open an account so they can deposit their paycheque. Blaming this on 'poor financial literacy' is backwards - all the financial literacy in the world won't help you when banks systematically discriminate against you.

>"all the financial literacy in the world won't help you when banks systematically discriminate against you"

What the non profit did was show people how to use banking services, how to save, etc. and lo, people did. So what you say could be true some where but, it's disproven here where the non profit introduced people to the banks.

You have not given any details, so I cannot evaluate what this nonprofit was actually doing - that is, there are two questions:

1) How much were they doing? That is, where on the scale were they from (a) just literally letting people know that saving was a thing and banks existed through to (b) actually going in with people to open accounts, making personal introductions, acting as guarantors etc?

2) Who were they helping? That is, where on the scale of 'relevance to systemic discrimination that I discussed' were their clients from (c) mostly educated white college graduates with good credit history and family money (though perhaps not much personal money) living in 'good' areas through to (d) mostly poor black lower class minimum wage workers with bad credit history living in 'bad' areas?

It is a relevent counterpoint if the nonprofit is mostly doing (a) and mostly helping (d) - otherwise, it is entirely irrelevant.

That is, because doing (b) firstly does not scale, so it only fixes the problem for a few people, and secondly agrees with what I said, about how you need these things in order to bank if you fit into category (d). And because serving (c) is entirely irrelevant to the point about systemic discrimination, as (c) are people that do not face this.

So, please either show that the nonprofit was mostly doing (a) and mostly helping (d), or retract your point, as it is wrong.

I was looking for a comment just like this!

It seems when anyone talks about household expenses, just like this article, we get the same list: housing, food and transportation. I don't know why the cost of debt isn't right in the mix. Maybe it is assumed debt is paying for these other things, so when debt is paid off, the expense is just chalked up to the underlying housing, food or transportation costs. However, it ignores the fact debt carries its own costs which are significantly more expensive for the poor and the interest alone, especially on payday loans as you noted, could probably rival food and transportation costs of the poor.

And interest is a huge driver of wealth inequality. A large majority of people pay more interest than they receive in their lives, that money ends up at the top.

We need more diverse currencies that are not the debt-based fiat money we have now.

Personal debt is not the same as using a debt-based fiat currency. They are completely different things.

I live within my means but am not financially literate. It sounds like a good practice for me would be writing down my in/out cash flow - like you say, "It is about being able to keep a 3 month to a full year of cash flow right in front of you, whether on a piece of paper or a spreadsheet".

Is starting out really that simple? Writing down what comes in, and what goes out, and what you know will come in and go out?

It is simply keeping the expenses on the left rows, the time period on the columns (week, month), and keeping a running tally carried over to the next column at top. Sounds simple, but it is a powerful tool, since you see when you might actually dip to zero or below way before it happens, and you can plan. Simple keeping a balanced checkbook and writing your known expenses, is necessary, but does not provide the look ahead. You'd be surprised how many people who make more than 6 figures get caught short some months when for the year they're OK, but due to the ins and outs of cash flow, they are at a deficit one day or week out of the month. You can find plenty of templates online. I keep mine simple as compared to what my past business accounting was. I am hoping to get more deeply financially literate when it comes to things like investments for my future (kind of late now, and a fallout of how I was raised), but more so that I can at least teach all of my children. I don't subscribe to the work and retire model. I personally work to make ends meet, and work on my personal interests at night, or when I stop working and live cheap to devote more effort to the next round.

https://i.imgur.com/1rPEkGQ.png

That's pretty neat. I'll have a better look at it later. Thanks!

You're welcome!

I have a friend who used to write down everything he spent money on, then tallied it up weekly to see if he was on track. Over time he stopped doing that and transitioned into what happened that day, and now he keeps an interesting and concise journal.

So if you need additional motivation, think of it as journaling. When I travel, I still write down my expenses and what I did that day. I figure it'd be useful when I'm old to tell the kids how much a 1GB prepaid SIM cost "back in my day."

But seriously, keeping track of your expenses is a fundamental step in financial literacy. Hook everything up to Mint if you can't be bothered writing daily logs.

It's a good start. Read Mr Money Mustache to continue.

if puritanical lectures solved the world's problems, we would already be living in paradise.

Clearly there are a lot of reasons why some people struggle, and it's often not because they are lazy and profligate. There are structural societal reasons which can't be solved purely by hard work.

I can't speak to the puritanical, since I am an atheist and don't believe in paradise anyway ;)

I had to overcome a lot to get where I am as posted at the top of the thread, and I don't believe people are just lazy or wasteful (had to look up profligate - thanks!).

I'm curious to see examples of 'structural societal reasons' you write about for discussion, since I can only guess, and I don't want to assume.

I do, however, think there are truly lazy and wasteful people; I have known quite a few in my decades and travels. I also think they can change.

The world is a better place though in terms of worldwide people lifted out of poverty, and other indicators. "The U.S. ranks 6th worldwide in wages, but 25th in wealth..." quoting myself from another reply above. It is because we are a debt-based society.

I saw this in my old impoverished neighborhood in Brooklyn in the 60s through the 80s, and I see it starkly in contrast here in East Java. People re-purpose stuff more readily here like my mom and dad did back home.

Well done to you for pulling yourself up by your bootstraps, and doing well in life.

The stereotypical example of what I'm talking about is the child who grows up in a poor area with terrible parents, terrible schooling and little in the way of a good example to follow.

So who's teaching the kids 'financial responsibility' and the 'virtues of hard work'? And when they grow up without those values, who's to blame? When they have kids of their own, and the cycle continues, who's to blame then?

You're lucky that you had good parents, as are your own children by the sounds of it. But not everyone is as lucky as that, and simply lecturing and blaming those who grow up without that kind of luck doesn't solve anything.

Still not buying it.

I love my parents. My mom has passed, but my dad is still living. They didn't teach me financial literacy, however, I did learn about placing bets on horses at a young age ;)

My father and mother both never completed high school. Dad was an ex-merchant marine, Golden Gloves boxer (runner up champ in NYC in the 50s). My Dad and I have a good understanding now, but there were some really bad physical times in the household, let's leave it at that without making this an Oprah show candidate.

I would say that movies and books some consider trite, contrived, romantic, boring, unrealistic, nowadays, helped give me an ideal to live towards, or heroes if you will. I think there aren't as many, but they are shunned or looked down on in current times by intellectual elites to the detriment of the good they do.

I grew up without TV, and a phone for most of my childhood. It wasn't until I was eleven that me and my friends rode the subway from Brooklyn to Manhattan without adult supervision.

Even some of the poorest in the US have internet and a semi-smartphone for immediate at-your-fingertips information. I would say they have a leg up on some of my peers there. So, aside from the tails where there are extreme cases, I am an optimist, and think it is easier to escape your roots so to speak.

[Edit] I realized after reading my response that I still carry a chip on my shoulder, but in the interests of transparency, and a lesson in humulity, I'll let the post stand as is. My apologies if any offense is given above.

>if puritanical lectures solved the world's problems, we would already be living in paradise.

Same is true of excuses.

I guess the real hurdle is getting people to understand the contradiction between

a) "schools should require financial literacy for graduation" and

b) "standardized testing is the spawn of satan".

Or just offer it generally, forget about testing for it.

How many people had any kind of accounting or personal finance in high school? More than 1 semester?

Not me. And if that's generally true for many, than that is a tragedy.

How practical, and helpful would that be for students?

And yet it doesn't seem to be a focus of our public schools.

Not to mention the death of the trade school of learning how to operate machinery and tools for woodworking and metalworking.

On a bright note, some of the engineering programs are incorporating more hands on experience, since it informs an engineer's take on what he inevitably asks to be produced.

There were monthly mandatory pep-rallies in my school growing up. No classes about financial literacy though. I guess they thought we would all join the NFL after graduating.

> I have been teaching all of my children, and ranting about it online occasionally, that a lot of younger people are financially illiterate, including so-called smart or tech people.

You are right on the money. And that is true even in third world countries(I live in one).

Financial literacy was assumed to be taught by parents. Unfortunately, not all parents are financial literate either.

Financial education isn't taught in school. I recommend showing your kids Rich Dad Poor Dad as well.

I don't have a replacement book, but Rich Dad Poor Dad is less well thought of now. I believe it has a strong push on property as investments.

It is maybe a better route to look at 'three fund portfolio' low cost ETF/mutual fund strategies.

Investment blogs such as Mr Money Mustache may also be a good road into a good long term investment strategy.

Yep, just pull yourself up by your bootstraps! Poor people are simply stupid and lazy. I would know, being an intelligent member of the upper middle class.

I think his comment and attitude would be more helpful, motivating and inspiring to most people, poor or otherwise, than your self pitying snark. Honestly.