steve siebold

If you want a high school diploma in North Carolina, you’re going to have to pass a personal finance class. The new requirement was voted on earlier this month by the state board of education. This is great news and more states need to follow suit.

The numbers on financial illiteracy are shocking. As it stands, two out of three adults worldwide are financially illiterate, according to a Gallup poll. That’s billions of people who don’t know how money works. Consumer debt was approaching $14-trillion after the second quarter of 2019, with Americans drowning in credit card debt, mortgages, school loans and car payments. Even worse, 21% of Americans aren’t saving any money for retirement, emergencies or other financial goals.

There’s never a bad time to learn about money, but the earlier in life you do, the more in control you’re going to be and the better your chances of not having financial problems later on in life. The National Council on Economic Education showed that 66 percent of high school students tested on basic money skills scored an “F,” and more than 50 percent of the same students surveyed had received no financial education. This is why it’s so important that we start teaching our kids about it in school.

Think about it this way: Money is not like cooking, golfing or any other skill you can get by without. If you don’t know how to properly grill salmon, who cares? If you can’t drain a 20-foot putt, so what? But if you don’t have a clue how money works and are financially illiterate, you’re in really big trouble.

It’s imperative to have a strong understanding of money which will allow you to make better financial decisions that can hopefully improve your day-to-day life. You don’t need to become a financial advisor or CPA, but everyone should have a basic understanding of how to earn, save, spend properly, manage and invest money.

It’s time for our schools to get with the times and start teaching our children real-life skills that they can actually use, like personal finance.

Personally, I can’t recall the last time I used an algebraic expression or had to determine if two lines were complimentary or supplementary, but I can give you thousands of instances where knowing how to budget, understanding the power of compound interest and how to increase cash flow helped me immensely and I avoided making some huge financial mistakes.

What’s worse is that many of our kids are craving this kind of knowledge, and we’re not giving it to them. Mariah Morris, who was the 2019 teach of the year in North Carolina, said, “The students want to know about credit and debit, taxes, what W-4 forms are, W-2, how to budget, how to get grants for college, what fraud is, 401Ks, interest levels, how to get a mortgage and how to do business forms.“

Knowing beans about money is worth a lot more than bragging rights. It could mean living your best life today, realizing the dreams you have for yourself and your family tomorrow, and helping others do the same.

The bottom line: Those who study money have a greater chance of becoming wealthy. As they learn, they stop doing stupid things, start measuring their decisions, and begin leveraging information to make smarter moves. Knowledge corrects behavior. Correct behavior alters the future.

It’s time we set all of our kids up for financial success in the future and mandate personal finance classes in our schools nationwide.

(Steve Siebold is author of the book “How Money Works: Stop Being a Sucker.” He’s a self-made millionaire who has interviewed more than 1,300 of the world’s wealthiest people over the last 35 years.)

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