awesome parents that modeled a great example for marriage, finances and money management. I learned a TON from them! My mom gave me a credit card when I was 16. You’re going to think that’s crazy but it was actually genius. She gave it to me and I knew she checked the balance. She taught me to only spend what I had… even though I had a $7,000 limit! To a 16 year old, that sounds AMAZING!!! But Momma explained that if I spent more than I had in my checking account and couldn’t pay the full bill off at the end of the month, that would result in me having to spend even MORE money in the end…. and that was stupid. So! Because she warned me of this and I knew she was watching, I was responsible. Gradually she became less and less involved and halfway through college, she took her name off of that account and I was on my own. I’m actually a little sentimental thinking about it right now because that simple act of parenting on my parent’s part taught me more about finances than anything else. Michael and I are debt free (besides the mortgage of course). I have had a credit card since I was 16 and I have NEVER not paid the balance off…. which means I have an great credit score…. and this isn’t because I’m awesome…. it’s because my parents did an awesome job teaching me EARLY about debt, interest and how to live within my means. I owe them big time for that. To some, giving a credit card to a teenager is crazy… but in our case, it was one of the BEST financial lessons I learned from my parents.
So, let me continue about the heart of this post. I needed to share about my childhood credit card experience to show that my parents really did teach me basic life lessons that I needed to know. However, there are some areas of life that I feel like I should have learned about in HIGH SCHOOL to prepare me for general aspects of LIFE. I learned about derivatives and the periodic table (that I have NEVER used)… but I didn’t learn about how to do my own TAXES?! I never once was taught about MORTGAGES or INTEREST?! …. Or how to apply for a loan? Or how health insurance works? Or how to invest and save for retirement?! I graduated high school AND college without knowing what a 401K or a mutual fund were. Sure, if I was a business major, I would have known some of this…. but I was a communications major and I really think this stuff is universal knowledge that EVERYONE should know! Here is a full list of life lessons that I think should be a standard part of education before entering the real world:
– Why invest life insurance and how to do it.
– How to buy and sell a new or used car.
– How to write a will and when to do it.
– Define and explain income tax, personal property tax, sales tax, federal taxes, state taxes, estimated taxes, etc.
– How to apply for a business license.
– Define and explain the difference between a foreclosure and a short sale and really explain equity!
– How to do your own taxes.
– What is required to purchase a home? What is the “underwriting” process?
– How do you apply for a mortgage? What is Mortgage insurance? How much should a down payment be? What’s a good interest rate?
– How to balance a checking account.
– What to look for when buying a house (mold, water damage, mildew).
And the list goes on and on. I know that some of this stuff is over high schooler’s heads…. but for kids that leave high school and enter the workforce with no higher education, high school would be the only time to learn this stuff! It’s IMPORTANT stuff. Michael and I have learned about all of this as we went along…. which is how most people do it. So I guess it’s normal to not totally understand all of the mortgage and tax lingo…. but if I’m being honest, I wish I had been more knowledgable about all of this before I was LIVING it. I think knowledge about debt and interest would save SO many young couples from financial disaster early on in their marriages. We love Dave Ramsey’s radio show because it’s so interesting to us to hear everyone’s different stories. People call in with $40,000 in debt on their credit cards…. just from careless spending over the course of a few years! It’s wild!!
So what’s the point of this post? Well, I’m not really sure! I guess I just wanted to share my thoughts and frustrations about the whole topic…. and maybe there’s a parent of a teenager out there that still has a chance to prep their kid for some of these real-world realities!! Imagine what our economy would look like if everyone was knowledgeable about these things?! It’s just a crazy thought. So am I the only one who thinks about this stuff? Am I the only one who hasn’t used calculus since the 10th grade?! I sure hope not:)
So now that I’ve won the “Most Random Blog Post” award for the week, I hope you’re having a fabulous Thursday!! Enjoy your day everyone!!!
Photo cred: Jasmine Star (Love our wedding ring shot:)