It is a pretty straight forward question: why isn’t personal finance taught in school?
Most of what you learn in school is irrelevant (often useless) stuff that you will never use in everyday life. Let alone to build a successful life.
For example, would learning everything about the Battle of Hastings in 1066 AD really help you in your career prospects?
Is dissecting a frog in biology class in high school really going to help you find and afford a place to live?
Is learning how to write poetry, stanza by stanza, going to save you from a lifetime of debt (mortgage, car loans, student loans, credit cards, etc.)?
The answer is NO!
None of that will help you build a successful and prosperous life.
None of that will help you navigate the job market, stay out of or eliminate debt, find/ build a home, or start a family!
Furthermore, none of that will help you save and investment money for retirement, build multiple streams of income, and reduce financial stress and turmoil (which often destroys relationships, families, and lives).
Yet more time is devoted in school to that kind of stuff, then the one thing in the world that will help you build a better, successful, and prosperous life.
Learning about personal finance!
What is Personal Finance?
In short, personal finance is umbrella term that covers how to manage your own money and includes topics such as saving, investing, budgeting, and building wealth.
Want a longer definition? See this article from Investopedia!
Most people are financially illiterate. Meaning they have little understanding the various aspects of managing money.
In fact, in an annual personal finance survey, only 23% of respondents answered 3/4 of the questions correctly. In addition, American adults on average only answered 50% of the questions correctly.
This is sad because so much of a person’s success in life depends on the understanding of money.
You may have earned high honors in school, however, if you are unable to manage your finances how are you going to build a successful life?
Why Isn’t Personal Finance Taught?
There is the million-dollar question? Why?
How could something so important to one’s well-being be overlooked?
I really don’t have an answer to the question. I could get conspiratorial.
Maybe the corporations and their stooges in government don’t want people to save. Maybe they just want to keep people spending? Thus, remaining constantly in debt.
After all, the more people consume their products the richer they will get.
Maybe the politicians are afraid. Afraid of people figuring out the tax system?
Can you imagine if people started realizing just how much they really pay in taxes each year (and how much is wasted)?
There could be a large-scale tax revolt! Imagine if there is a demand for fiscally-responsible government. A lot of politicians would be placed in a horrifying spot.
Maybe most of the teachers and administration themselves are financially illiterate?
If so, it is a case of the blind leading the blind.
Maybe it is all of the above together in a perfect storm of financial ignorance.
Schooling versus Education
One thing is certain, on average, students who do learn personal finance at a young age have been shown by various studies to do better in life financially.
They have less debt, better credit scores, find it easier to pay the bills each month, more likely to save and plan for retirement, and have a higher net worth.
More people would make better choices if personal finance was taught in schools. The earlier the better too.
I am reminded of the people with college degrees in “art history” working in fast food making minimum wage struggling to pay off their loans, behind on the rent (or still living at home with parents at 30 years old), and unable to afford anything.
Is that your life? Can you even call that life? But you graduated with a 4.0 GPA?!
This is seen a lot. People who do great in school, but fail at life.
School does not prepare you to do well in life (quite the opposite). You have to take the reins of your own education!
It was Mark Twain who famously put it: “Don’t let schooling interfere with your education.”
I was in a very similar bad spot in life. However, learning about personal finance was life changing and motivating for me.
The ambition to do great lead me to pursuit better jobs, purchase my own apartment, remain debt free, build a six-figure investment portfolio, and manage a monthly budget where I am saving over 50% of my income.
School didn’t teach me that. I had to learn it the hard way.
Conclusion: Why Isn’t Personal Finance Taught in School?
I wish I had learned about personal finance earlier in life. I believe a great many people would be better off if personal finance was taught in their schools.
Why isn’t personal finance taught in schools?
I don’t have a solid answer. But it is never too late to teach yourself like I did.
Over the past 5 years, I’ve built a six-figure portfolio that generates a yearly average of over $1,000 per month in dividend income!
That is passive income that I earn while I sleep!
If you are interested in beginning your own journey into dividend growth investing, personal finance, and financial freedom, check out my Getting Started page.
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So, why do you think personal finance isn’t taught at school? Also, is/was financial education part of your school system? Or did were you self-taught like me?
Let me know in the comments below!
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