Comment by pembrook
18 days ago
Any argument against teaching financial literacy can also be applied to pretty much any topic taught in schools.
You could also write the same clever-sounding contrarian think-piece about why teaching Home Economics doesn't make sense until you have your own home to run; teaching CPR doesn't make sense unless there's someone choking right in front of you; etc.
Using the logic underpinning this article, the only things taught in school should be how to play video games, how to find the best parties and how to get laid; since those are the only things actually relevant to students at that stage of their life.
Obviously studies will show that most students don't become financial wizards after taking financial literacy classes, because that's how it is with all education. How many kids who take English class become good writers?
Doesn't mean we shouldn't offer the knowledge for those willing to take it.
Why should I learn this?
This is the question most kids ask when offered education. If you answer that first, everything else follows.
Start with why. (Thank you Simon Sinek.) Are there meaningful, ongoing benefits to learning how to make specific decisions with your money? Should you care enough to learn the more mundane details like reviewing expenses or filing your own taxes?
I know there are attempts, like showing those log graphs that try to impress upon young minds the long-term value of compound interest. I'm sure those help a few people, but I do wonder if there might be other more impactful concepts.
Personally, I get a great deal of satisfaction out of things like efficiency, self-reliance, and so on, but I don't know if valuing those things can be taught, or just develops organically. Regardless, I think you always need to impress upon students the motivations for their decision-making and try to help them care. The rest can come later.
> Start with why. (Thank you Simon Sinek.) Are there meaningful, ongoing benefits to learning how to make specific decisions with your money?
It's a great approach when the "meaningful, ongoing benefits" start to occur either immediately, or in the near future when you're living a life very, very much like the one you're living today.
The difficulty of doing that within the context of educating 5-18 (+/- 4) years olds is that benefits (and costs) of learning (or not) are far, far down the road, in a life that they can typically not even imagine with any degree of accuracy.
Many high schoolers on the cusp of needing some finanical literacy. They may be starting their first jobs, and making a budget and saving for a rainy day would be good skills. Others are about to borrow for college and financial understanding could help them avoid getting into a lot of debt in order to struggle at a degree that they end up not attaining, or in order to attain a degree that doesn't add up economically. Some may be moving out (voluntarily or not) and need to have an income, find a place an pay rent, pay for food and utilities, etc, with potentially little room for error.
Yes, this is a very general insight, not just for education, but for any presentation: work backwards from what problem you're solving with the material. Then everything makes so much more sense!
> Start with why
This would have done so much for me, especially with the more abstract math classes that made no sense until much later. It would have been good if the math problems even approximated reality. Simple things like adjusting a recipe to a different number of people, applying taxes, calculating interest. Only shop class gave me the satisfaction of doing something concrete.
For me, there was no "aha!" moment in high school, and it made it very difficult to understand why I needed to care.
https://xkcd.com/1050/
Excuse the smugness. Just providing counter perspective.
I know people, this does not help more people to easily understand the topic. But, lot of math like number theory was worked out as a intellectual exercise rather than application based.
Application followed theory. And people theorized for fun.
That can also make topics, abstract and unrelatable.
How is it a counter example?
Things you won't end up using lack any "why" beyond "just in case". The only way you avoid using personal finance skills is if you partner up and completely offload that responsibility onto someone else. Fine, in that case, don't bother learning it!
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The thing I think you’re missing is that financial literacy is not like most subjects taught in schools. Schools teach math so that students can do sums; they teach reading so that students can read. But financial literacy, sex education and civics are not about knowledge; they are about *character: they are less about what students can do and much more about what they ought to do.
The methods used to inculcate character are, I think, different from the ones used to build knowledge.
From talking to people who, leaving high school, didn't know "obvious" things about finance, had a bad time, and course-corrected as soon as they figured it out: I'd say it's a lot more about knowledge than you're supposing.
You'd be amazed the things people with parents different from yours didn't pick up.
Is that the best way of thinking about it? I think the goal of all primary and secondaey education is to impart knowledge, build skills, and build character. Take sex ed. Building "practical skills", namely applying a prophylactic device to a banana. But it is also about teaching you that there are risks to certain behaviours that need to be considered. And being forced to discuss it sensibly and without giggling every 30s builds character.
Or take maths. Maybe it is reductive but I think the difficulty of it helps build character. Most kids need to do a lot of exercises and memorisation, and the feeling of accomplishment of getting it and doing well? That is character building. Obviously immensely useful too.
Civics (we had "social studies" and I don't recall ever discussing our political system, but at least in theory) involves:
- teaching facts about the system (how many representatives there are, how often elections are held, who is responsible for what, what do courts do, what do juries do, what do MPs do, what do the police do, how are they structurally different from civil servants or the media or universities etc)
- teaching skills (how to vote, how to think about political/societal structures, etc)
- teaching character (instilling civic pride, understanding the long and rich history that led us here today, etc)
I thought the purpose of primary and secondary education was to progressively build a fungible work unit.
I'd say character is necessary but not sufficient. You also need knowledge and motivation.
Knowledge keeps you from investing in ways that mostly lose money. Plenty of young people try to do the right thing, and screw it up.
Understanding compound interest can improve motivation. Exponential functions aren't really intuitive to most people. They tend to make linear projections, which causes people to underestimate the rewards from investments and the damage from debt.
(The article of course isn't saying we shouldn't teach kids this knowledge; it's proposing better ways to teach it.)
I don’t think it needs to be about what they ought to do. You can tell someone, if you abuse credit cards to buy a bunch of stuff you can’t afford, you’ll end up broke. They can make the “I don’t want to be broke so I won’t do that” connection on their own. Lay out the facts and consequences and you’re all set.
Same with sex. You don’t need to tell them not to get pregnant, or get someone pregnant, in high school. You teach them how to avoid it and what happens if they do it.
There is quite a lot of technical knowledge involved: what is inflation, how to defend against it. Various investment instruments, their risk profile. What are popular scams, how to recognize (credit cards is the most popular and dangerous scam IMO). Сompound interest, mortgage calculations, etc.
As to the "character", that's mostly learning about the mathematical concept of "less": spend less than you earn.
Financial literacy is not some magical thing that lies outside the realm of topics like math and history. It is math and history.
Building character might be needed to make good financial decisions, but the knowledge of the mechanics of how markets, debt, investment, compounding, pricing, fractional-reserve banking, etc. works are just concepts like any other. Teaching them is good.
Sure, we won't magically make people less prone to emotional decision making. Teaching about gravity doesn't make you less prone to it either, but understanding how it works is good.
How this "financial literacy can't be taught" thing became a meme I'll never understand. Like most things on the internet, it seems to be a hipster contrarian reaction to the "why isn't this taught in schools" comments you'd see all over the web in the 2000s.
How about we stop trying to get attention for having interesting contrarian "takes" and just try doing the common sense thing and work on improving it from there.
I think the point isn't that teaching financial literacy is pointless, just that its impact is severely reduced due to external factors. And wringing our hands over the details of the curriculum is bike shedding, as alluded to in the article. John Doe can ace his financial literacy course and still go on to max out multiple credit cards after high school because of pressures that couldn't be understood from declarative knowledge alone.
When I was in middle school we actually cooked and baked in home economics, we didn’t memorize recipes showed on an overhead projector. In Physical Education we ran the mile, didn’t want videos on optimal technique. I think this is the main point.
i think your examples are actually fantastic. a home ec class where kids actually cook something is much better than just reading a bunch of recipes. a CPR class where you practice on a dummy is better than just watching a video on it.
fwiw i had the same experience with money that the article talks about. my parents tried to impart alot of wisdom on me but it hits different when you have actual money in the market and see it go down.
In home economics though, you are cooking real food, right?
Yes! My wife grew up in the SF Bay area in one of the wealthiest suburbs. They had water polo, cross country trips etc. They did not, however, have home economics! It makes me so sad, as I see her peers (and for a while, her) be relatively clueless on cooking at home.
The number of restaurants and coffee shops has exploded compared to when I was a teenager.
It starts to add up if you go to Starbucks frequently.
I vaguely remember home economics. We cookes things I don't like. I didn't learn cooking that way.
Yes. I also did some sewing. And in shop class we did actual woodworking. I think active project based learning is best whenever it's possible and practical.
We had home economics for one quarter as part of a rotation through grade-school electives: art, home ec, drama, wood shop. We didn't learn much about cooking, but I did learn how to sew on a button and do some basic clothing repairs that have come in handy.
No. In our Home Ec course, we baked cookies, that was it. The rest of it was in the classroom. I imagine that the experience varies from one district to another.
The other point the article makes is that most of the children literally can't understand it because they are completely innumerate.
Proposing the teaching of financial literacy when the children are baffled by arithmetic is absurd.
Your "use case" should be, there's a 22 year old college student living in the dorms. How will this software get him laid?
— Jamie Zawinski <https://www.jwz.org/doc/groupware.html>
Interesting thing to quote, given that JWZ hisself now says:
> If all the people who claimed to have been "inspired" by this piece hadn't been, and had just kept writing middleware for banks or whatever, the world might have been a slightly better place.
> I wish I had never published this.
It seems that what he actually objects to are the now-ubiquitous surveillance, centralization, and black-box algorithm curation aspects of social networks – not the actually social parts.
> teaching CPR doesn't make sense unless there's someone choking right in front of you; etc
This would actually be amazing if possible.
“Operator, I need CPR lessons, now”
Like Neo in the Matrix - “I know Kung-Fu”
I've used the Heimlich maneuver once in my life. Interestingly, it was on a nurse anesthetist - who also knew enough to do the hands-around-neck choking sign to indicate what he needed, and turn around so I could do it. In the surgery lounge at a hospital. Popped out on first try.
You grossly misrepresent the points of the article!
I usually hate such one-liner responses, but in this case, really, it is the article that needs to be read, not my reply. I could not say nothing and let this stand though, the contrast between the comment and what is actually in the article is too large.
I do not.
The article claims that teaching financial literacy is a "fallacy" ie. doesn't work because kids have no way to contextualize something they don't have a need for. So we should give them the need for the knowledge by instead helping all kids start a small business.
Again, the equivalent would be kicking children out of their parents homes and helping them find apartments so they can get experience in Home Economics.
Maybe we just start by teaching kids financial literacy the way our educational bureaucracy knows how to instead of fighting it because it's not perfect.
I think what the author was saying is that we teach the intellectual theory of financial literacy but not the emotional practice of it. To use your home economics example, i assume the author would equate it to reading a book on how to cook an egg instead of firing up the hot stove and dancing with the time pressure, heat pressure, and attentional pressure that can come with cooking a meal.
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You present a tiny fraction of the article and argue against it.
Most comments arguing against omit major points, they make zero mention of it: For example, the author points to the abysmal skills in very basic reading and math of a large part of pupils, and argues - rightly so I would say - that adding more and more on top when the very basics are missing!
I stand by my comment. A lot of people here argue on reflex or by picking some tiny piece of the whole. This is one of the more a terrible discussions on this site, for some reason I don't see.
IMO the author makes some really good points - especially when you take his whole argument, and not individual pieces. He also does not just criticize, he also has suggestions for what to do that are worth looking at.
The discussion reminds of the many voices saying "they need more training" after some police officer killed an unarmed suspect that was not threatening them. As if that would help, when in that case it is an attitude and lack of accountability problem, and in the case of this discussion it is incentives and human psychology and lack of the basics that overwhelm anything you could teach on the subject itself!
The author rightfully argues against this "needs more training" panacea for all human problems, ignoring much larger forces and how humans and their brains work.
He also does not at all argue that there should be no financial training! He argues that it has to take into account those other problems, and he makes suggestions for how it could look like.
On the other hand, I saw not a single one of those quick article-condemnation comments take any of the many points made in the article into account. All picking either just the general idea in one sentence alone, or picking one or a few sentences to argue against, disregarding all other points, even though they all belong together.
The article claims that teaching "money math" on a whiteboard that lacks any relation to real money won't make students learn financial literacy and the time wasted there should be replaced by something else.
There is also a serious implication that "hey, students didn't have enough time to learn math, maybe we could add the time to it". But it's an almost irrelevant side point, and I got from it that the author would be perfectly fine with teaching real financial literacy instead too.
So, yes, you seem to have misunderstood it.
I mean ... once you put it that way, yes, I'm actually willing to bite that bullet! (Or at least a cleaned-up, steelmanned version of it.)
It's vanishingly unlikely that any student who learns "personal finance", with no practical application, is going to retain it for the 5+ years until they'll actually need to use it. Learning doesn't work that way -- with, as you note, a few exceptions for unusually motivated students ... who would probably be able to learn it on their own when the time comes.
Ditto for the famous meme about "why don't schools teach something useful, like doing my taxes?" Because it would come across as an ungrounded, garbled mess that you'd forget by the time it was actually relevant.
So yes, I'd say that generally, education should work by grounding lessons in some kind of practical application. And indeed, like the other comments note, that's how it works for some of your other examples, like actually cooking something for home ec, or doing CPR on a dummy (which mimics most of the dynamics of the real thing, even if imperfectly).
I think there's a real human need being expressed by the common complaint, "When are we ever gonna use this stuff?" I'd phrase it as, "You're not grounding this material in a way that allows me to reason about it, and what's important vs isn't."
So, to the extent that we want to prepare students for "the real world" -- in particular, things like "doing your taxes" and "evaluating a car loan" -- I'd say the best way to address it would be by teaching the (meta-)skill of "learning an unknown domain". (Yes, "learning how to learn" ... but as an explicit skill, not one applied to material that is itself too artificial.) That's something you could apply to practical problems, even if they're not the same ones students will be solving later.
Applying this insight to the teaching of literary analysis: frame it as refuting an internet comment that doesn't understand that a song is a metaphor.
In fact, one thing that frustrates me about how the teach estimation in math is that they teach a useless version of it: you do something that takes about as long as calculating the exact value, except you add some rounding steps because you're told you can't give an exact answer. What you should instead do is give a timed test, which much more problems that usual, and only require approximate answers. Then you're forced to save time by rounding.
Late edit:
>Using the logic underpinning this article, the only things taught in school should be how to play video games, how to find the best parties and how to get laid; since those are the only things actually relevant to students at that stage of their life.
Yes, it does annoy me when the education system neglects the teaching of some skills that don't come naturally to some students, but not other skills.
I think this debate about utility misses some of the functions of education that the Romans (like Aulus Gellius and Macrobius) discuss: they talk about education having three parts, namely utility, pleasure, and "cultitavtion" or "culture" (for lack of a better English word). Yes, some education does have direct practical application (utility) in life, but that alone is not sufficient. And, education must include pleasure and teach one how to take pleasure in things, or else it becomes an oppressive training in servility. But the third element, "cultivation," is the one that people today most often overlook. It's the Roman word for tilling soil, which you do not because it makes plants grow (that's sowing seeds) but because it prepares the ground for plants to grow when you do sow them. There are some educational activities that do not have direct and immediate utility but do open up new capabilities that can lead to future utility. Learning geometric constructions, for example, may not have immediate practical utility, but it may prepare the mind for trigonometry. Grade school art class never made anyone a Michelangelo or Monet, but learning to hold a brush or sculpt clay does promote fine motor skills that will enable one hold a pen later in education or maybe, with more practice, a scalpel in medical school.
Financial literacy for those who do not yet have wealth to manage, even if it doesn't seem practical in the moment, still opens up new capabilities to enable future growth.
>I think this debate about utility misses some of the functions of education that the Romans (like Aulus Gellius and Macrobius) discuss: they talk about education having three parts, ...
Sure, but I was making that point in the context of a discussion that accepted the premise that we do want kids to be good at a practical skill (personal finance) and we want to know how to best adapt schools to achieve that.
> But the third element, "cultivation," is the one that people today most often overlook. It's the Roman word for tilling soil, which you do not because it makes plants grow (that's sowing seeds) but because it prepares the ground for plants to grow when you do sow them. There are some educational activities that do not have direct and immediate utility but do open up new capabilities that can lead to future utility. Learning geometric constructions, for example, may not have immediate practical utility, but it may prepare the mind for trigonometry.
It seems like you're agreeing with my point there, about the need to ground the knowledge in what it will be used for, and thus some meaningful criteria for whether you're doing it right, that you can reason able. See my paragraph about "When are we ever going to use this stuff?": yes, it would tremendously help to teach tilling soil with an eye for "which tillings will actually make the soil receptive for seeds?" because then it would make a ton more sense why they're telling you to do it one way vs another!
>Grade school art class never made anyone a Michelangelo or Monet, but learning to hold a brush or sculpt clay does promote fine motor skills that will enable one hold a pen later in education or maybe, with more practice, a scalpel in medical school.
And again, you're agreeing about the need for practical application of a skill (actually using the brush).
>Financial literacy for those who do not yet have wealth to manage, even if it doesn't seem practical in the moment, still opens up new capabilities to enable future growth.
No, the issue is that it won't -- unless it hooks into some meaningful understanding that prevents it from folding into "useless esoterica where you have to guess the correct answer and then forget about over time", that most education falls into the trap of.
There’s an interesting difference between learning how to do taxes and learning how to evaluate an auto loan, in that the latter is often adversarial. Thousands of highly-paid experts spend their days figuring out how to get you to take on more debt and pay more fees and interest. With taxes, you might have Intuit or whoever trying to get you to buy prep services you don’t need, but it’s small potatoes by comparison. You can at least get unbiased tax info directly from the source. Nobody from the IRS will try to upsell you on a seat massager option that’s only $10/month more (and it extends the loan term by two years but let’s just gloss over that).
I’m not sure exactly what it means here, but I think there’s a big difference when it comes to teaching people how to learn things that powerful vested interests want them not to know.
Agreed. And the article talks about that some:
>Most personal finance math is basic arithmetic – the same arithmetic that most of our students currently struggle with. The hard part is everything else: impulse control, peer pressure, status anxiety, and the fundamental uncertainty of the future.
>Teaching teenagers about compound interest won’t help them resist the urge to keep up with their friends’ spending any more than teaching them about calories will stop them from eating junk food.
Still, you can at least separate out those skills as being independently worth teaching: how to figure out the impact on your budget, and the social dynamics driving your options.
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