When I was in high school, the closest thing we had to a personal finance course was home economics. While I don’t fully trust my memory, I can safely say that some aspects of what we now call personal finance were a part of that course – opening a bank account, balancing a checkbook, tracking expenses, food shopping and meal planning, etc. But in my school (anecdotally speaking in most schools I’ve heard about), it was a course that the girls took while most of the boys took “shop”.  That and the fact that these courses gradually disappeared from many schools are topics for another day.

Whether its home economics or personal finance, it is, ultimately, personal. Our unique experiences are what separate the topic from the bigger world of finance – the one with international trade, currency fluctuations, PE ratios for stocks, bond markets, and other dizzying concepts. 

Our story is the one that matters.

So, I’ll tell you mine (well, just part one for now) if you’ll promise to at least think about yours. It would be even better if you would write yours. I found the experience enlightening, liberating, emotional, and satisfying.

It was 1974, and I was the youngest paper boy in the state. Every morning, I hit the streets of Derby, Connecticut, sometimes in the dark, sometimes on my bike, sometimes in the car with mom, but most often alone. I made my rounds, placing the rolled up New Haven Register papers inside screen doors or dropping them in mailboxes. I delivered to houses, pizza places, and law offices in brick buildings with huge wooden doors. Once every two weeks, in the afternoons, I made my collections, took home the 20 or 30 envelopes, and laid them on the kitchen table. I reconciled my receipts, calculated what I owed the company, counted my profits, and figured how much I could put into my savings account. I was nine years old. When I was 12, I would turn much of those savings into my first major purchase – a Radio Shack stereo, along with a few of the best rock albums of 1977 including Point of No Return, Book of Dreams, and The Grand Illusion. What a system: work, earn, save, spend, repeat.

On the mornings when mom drove me – either because of weather or because I was nine – we somehow found time to stop at Dunkin’ Donuts. Mom got a black coffee and we both got double chocolate donuts. I remember one morning, after I’d had the paper route for a few months, when I paid. I couldn’t get the money out of my little change pocket fast enough. I still choose the double chocolate donut when I go to The Dunkin’, and I think of those mornings with mom. 

I got my first credit card at 20, and by the time I was 25, I had at least seven or eight, each carrying balances of several hundred dollars or more. The system had changed. Work, earn, spend more than you earn, pay interest, work even more to pay for it all, repeat. By 27, I was caught in a dismal cycle. My job paid well, but I hated it. I needed that job because my obligations had grown along with – no, grown faster than – my income, and I couldn’t match it doing something I wanted to do. I was on a treadmill that was outrunning me, and with each day I saw that my job was sometimes contributing to others’ treadmills. I soon found myself looking beyond that misery and reaching for the philosophical. What happened to the paper boy? What kind of system is this? How do I get out?

Edge of your seat, I know. Spoiler alert – I did climb out of that mess and have gradually found firmer financial ground. However, that rough start was expensive, and I’m still paying in terms of opportunity cost. Let’s just say that my expected retirement age went up while my lifestyle options while retired…yep, they’ve gone the other direction.

Not only do our stories matter, but they are also incredibly effective when teaching personal finance. In my experience, students are more likely to listen to and put into practice financial education when the messages have a face and feel real. It’s no different than that history teacher (I think most of us had one) who used stories to make past events and people relatable and interesting. This is the core reason why someone like Dave Ramsey has built a “money-talk” empire – he teaches from vulnerability, failure, and rebuilding.

We want our students to remember our lessons and messages. Stories and humor are emotional. Emotion prints memory. You can use your personal lessons and/or help students connect with and tell their own stories about money. This can highlight their experience so far or can help them explore what they want their personal finance story to be. I used to add an alternative project or supplement to writing a personal finance story – a personal finance road map – where students could make a poster-like project showing stages of their life and where and how money fits into their life experiences, goals, and dreams.

I know a few people who seem to have never made mistakes with money. I know a few more who have enough wiggle room to make mistakes with a capital $ on the end. However, most people I know (and, statistically speaking, the vast majority of Americans), have tripped and fallen and continue to stumble on their personal financial journey.

This former financially savvy paper boy turned wallet-full-of-plastic guy got to work on getting it right when I faced up to the reality of where my money behavior was taking me. The biggest steps I made along the way came when I dug into and learned from my mistakes, when I understood my story. 

I hope you’ll dig into yours.

Seville, Spain, sometime in 2018, English conversation class for college students. The topic: money.

“Credit score, credit bureaus… Oh boy, it’s tough to translate something that doesn’t exist in Spain. In fact, nearly all of Europe and most of the world do not use credit scores and don’t have centralized credit reporting agencies,” I told this class, as I had told many before, both in Spain and the Czech Republic.

“Can you explain it to us?” they asked.

“I’m not sure, but I will enjoy trying,” I replied, wondering if they had seen Fight Club. 

The American economic system is complicated (in casual conversations a stronger adjective is needed), and navigating our system when it comes to personal finance is complicated times ten. This is true in a vacuum and is especially obvious when compared to other countries. Yes, “land of opportunity” still rings true, and I say that after living abroad for 10 years and having taught students from more than a dozen countries. But the costs of that opportunity (sweet economics pun for anyone paying attention to such things) are the sometimes mile-high and spiky hoops we must jump through to get to, and maintain, those opportunities.

What makes it complicated? Hmm… Let me see if I can think of a few things: 

  • Credit scores 
  • The cost of higher education and student loans
  • Relatively easy access to credit
  • Predatory lending, check-cashing businesses, rent-to-own, etc.
  • Health care costs and access to affordable insurance
  • Social security
  • The national debt
  • The non-stop marketing machine that drives consumer society

Exhale. I realized I was holding my breath as I was typing. I further realized that I’d better stop there so as not to turn the whole blog into a list.

Oops, I can’t leave this one off the list: a lack of financial education to help face those challenges.

I can’t say these issues don’t exist in other countries. But I can say from personal experience and research that Nobody Does it Better than US, and “better” in this case is not always a good thing. Yet even with those challenges, America is still near the top of any list in terms of personal economic opportunity.

Has it always been so tough? In some ways it was certainly tougher on Americans before stronger labor laws, social security, banking regulations, and relative progress towards economic equality for all regardless of gender, race, or ethnicity. But some things have gotten worse, or are relatively new problems, such as easy access to credit and the consequences it brings. Statistics on credit card use and debt are easy to find and understand, but not easy to put into perspective. One thing is clear: in 1970, less than 50% of Americans had a credit card, and now it’s over 90%. Yes, convenience and technology are a part of that, and some of the side effects of credit card use are objectively good (safety compared to cash, cross-marketing benefits, etc.).

All Together Now

The connection to the complicated American financial system is that when it’s so easy to get credit, it’s so easy to misuse it, pile up debt, and make a real financial mess. Yet, as a nation, we allow our 18-year-olds into this system without the educational foundation (a shield) to understand and protect against the double-edged sword of compound interest. 

The generations responsible for allowing financial education to be largely ignored have an excuse; it wasn’t that long ago that credit cards were not easily available, people got jobs that they kept for 30 or 40 years which provided health care and pensions, a college degree was not in as high demand or as expensive (adjusted for inflation), there were no 72-month, $40,000 car loans, and our life expectancy was not a decade or more longer than our career expectancy.

It’s no one’s fault that it’s so tough out there. Our society and its unprecedented economic experiment have evolved, and there is plenty of good in that evolution. It will be everyone’s fault, however, if we don’t catch up and better prepare our new adults to step into the financial funhouse that we call American capitalism.

So, I ask myself again today, “What can I do to help one student, one class, one person, not only survive our system but learn to thrive in it?” Won’t you join me?