In which I reflect on my financial education to date, inspired by Blonde on a Budget’s post about financial literacy in schools.
My first memory of year 9 maths in high school is being teamed up with two others, going to the local supermarket and calculating what food and supplies would cost for a family for a week. Let me tell you, it’s really awkward talking about toilet paper and tampons with people you barely know…
But that wasn’t my first foray into this kind of thing. I’ve long known the value of a dollar.
Growing up, I literally do not recall seeing my mother ever buy anything that wasn’t on sale. When I was about 10, my best friend and I went to the supermarket to buy snacks and drinks. We were super proud about finding a 1-litre Coke for $1 and gushed about our frugality to her dad.
“That’s a good buy,” he said, and smiled. But when I told my mum about it later on? Her reaction: I can get 1.5 litres or 2 litres for the same price. Way to shoot down the kids, but she’s always been the bargain queen, and a blunt one at that.
Shortly after that I got my first paying gig, a paper run, and later on I would work TWO jobs in high school so I could buy an electric guitar and amp. I’ve always, always saved. I couldn’t really say why, as for years there was nothing I was saving for; I just knew it was the thing to do. Somehow my parents instilled that in me (thanks guys).
Business as a subject, though? I thought it was deadly dull and wanted nothing to do with it. Business studies was compulsory for a little while (maybe over the duration of one term) early in high school. You could then go on to do accounting or economics, and as you can probably guess, I chose not to do either. My mother is an accountant, something I thought was the most unimaginative and boring thing one could possibly be, and economics held no draw for me, either.
Of course, the older I get the more important I realise all of that is. Getting a grip on how the economy works is kind of a basic requirement of adulthood, I reckon.
Knowing how the official cash rate impacts interest rates, for example – that affects savers and borrowers alike.
Understanding general business principles too, which will serve most of us well because most of us do wind up in business, one way or another, to some degree. Yes, even those of us who pursue creative fields – who in many ways would benefit MOST from learning what being a professional in a capitalist society really involves. I‘m in an industry trying to figure out how to make money to sustain itself, and understanding the market and customers is vital to that. And amazingly, I’m finding this is actually quite interesting – and challenging.
I also believe understanding finance from a broader point of view is invaluable. While I’ve never been hugely interested in passive income – I like my work and don’t have any ambitions to retire early – recently I’ve been thinking about income security and growth. It really hit home for me that apart from trading your time for money, there are only a few paths to earning income. Here’s how I see them:
- Investing in the stockmarket
- Investing in real estate
- Producing products (presumably digital) that you create once and then continue to sell indefinitely, no extra effort required on your part
It would have been good to learn some of this stuff in school, because, um, who DOESN’T want to make money? Everyone, even high school kids (maybe ESPECIALLY high school kids) is interested in making more money.
I’m not saying there aren’t opportunities to learn and get involved in this kind of thing. For example, there are student stockmarket challenges you can participate in – one of my classmates did really well on those, making a ton of (theoretical) cash. But that kind of thing didn’t interest me back then, and in fact kind of intimidated me, so I didn’t seek them out. Also, it was all kinda nerdy and I was desperately trying to escape the pigeonhole of nerd-dom back then.
How things change. Money is sexy. I know that now. I REPENT.