Financial Literacy

hi its Jill Schlesinger and on this
episode of Jill on money we’re still celebrating financial literacy month so
we teach math everyday in every class every year from kindergarten through
12th grade and yet when we look at the International Studies the u.s. ranks
really low among its competitors other countries in math so we don’t say let’s
stop teaching math we say how do we do it better
welcome to the Jill on Monday podcast were presented by Marcus by Goldman
Sachs April might have been Financial Literacy Month but we celebrate
financial literacy all throughout the year here on the program today we’ve got
a great interview with nan Morrison she is the president and chief executive
officer of the Council for economic education nan has great insight on how
you may be able to improve both your own financial literacy and also that of your
children so here’s our interview with nan Morrison you’re listening to Jill on
Money with Jill Schlesinger nan Morrison welcome to the program it’s so
delightful to meet you I’ve heard a lot about you from our repeat guests beth
kobliner well thanks so much for having me Jill and of course Beth is
outstanding now you are the president and chief executive officer of the
Council for economic education so maybe you’re gonna think that this question is
kind of a silly question we say to every guest we begin the program with your
best financial or career decision that you’ve ever made I would say my best
financial decision has always been to pay myself first you did it you did what
they said you should do I did my father was dogged about this and in my very
first job after graduate school when I had a lot of loans car school rent to
pay he said are you putting in the maximum to get the 401k match for your
company and I said no and every week he asked me the same question for a year
and a half until I was up to that number I loved it so explain to us what the
Council for economic education does so we like to call it Cee because it’s
easier okay and our mission is to teach K through 12 kids about personal finance
and economics so that they can make better decisions for themselves their
families and their communities now when you think about that mission a lot of
people will ask about how is it that we can do a better job of maybe getting
personal finance into a broader curriculum and every time I write about
that people will send me this study which I actually wrote about recently
from the Journal of human resources here’s the here’s the quote that always
gets put into my face ready you’ll help me answer it the journal of human
resources in 2015 found quote there is little evidence that education intended
to improve financial decision-making is successful that’s not true I speak from
where I said ok so I mean I feel like everyone leaves off the second sentence
which is number one there are a lot of skills based classes that we teach in
schools you know I took sewing I took to cooking I took typing by the way which
was great actually I looked up the original study and what they said was
that it’s it’s not so much that it’s bad it’s just that traditional personal
finance courses may not be the best solution here’s the quote additional
mathematics training leads to greater financial market participation
investment income and better credit management including fewer foreclosures
they basically say if you want to improve financial decision making the
key is to enhance the mathematics curricula of the country now now tell me
why is that right wrong or sideways it’s sort of yes and yes that’s a giant
question mm-hmm so first of all I’m a big believer in
math I was a math major and yes I that data I agree with so we teach math every
day in every class every year from kindergarten through 12th grade and yet
when we look at the International Studies the u.s. ranks really low among
its editor’s other countries in math so we
don’t say let’s stop teaching math we say how do we do it better right and how
do we do it better so well let me not address math even though I was a math
major cuz I haven’t done that for a long time but there is a way to do personal
finance better and that’s to teach it all throughout a child’s school time
life K through 12 why sort of like math it’s another
language hmm and we have to start introducing kids young to the language
of money and once we start doing that it gets a little easier to teach them the
concepts also I will say there’s a lot of research that says when you teach
little kids about these concepts they retain it they become more interested so
ideally you’re improving math skills which is good for a whole variety of
reasons but you’re also teaching them about the language of money the language
of finance and making them comfortable and confident that they can make some
good decisions how can we encourage parents to do this even if they feel
insecure about their own skillset around this area well you hit it right on the
head there people feel really uncomfortable for themselves and they’re
also worried that their kids don’t like talking about this stuff and actually
kids find it really engaging especially the little ones because they like to be
like the adults in the room so in the past year we’ve started this really
nifty program called Family Financial Literacy nights and it’s meant for
parents their kids the teachers the principals and maybe even some
volunteers to come together at schools to play some really fun games usually
around math and personal finance and to start the conversation and parent after
parent has said to me I never knew my child would be this interested this was
the beginning all right so let’s plug this family financial literacy nights
where can people find out information about this well they can go to our
website Council for econ ed org get in touch with us they can also get in touch
with their schools and we can set one up at their school for them oh that’s great
and we can do it here in New York City and we can do it through our network of
national affiliates all across the country let’s get back now to what is it
that we need to be teaching in K through 12 what are the skills and the the
topics that you want them to be able to master not unlike we asked for some
mastery in some basic reading and writing and certain science well Jim we
actually believe that personal finance should be treated just like any other
subject so we carry out our mission by providing professional development
actual training to teachers so they feel confident hmm and just like in any other
subject we have standards and those cover the basic topics that you would
expect from personal finance so we think the kids should understand about savings
about investing about insurance and risk because certain investments are riskier
than others we believe that they need to understand about taxes and their
paychecks so so all of the kinds of things you would guess it’s really not
that complicated one of the most important things that we want our
students to understand is the concept of compound interest I think that that is
huge I would say that compound interest and time value of money just a basic
level of statistics like just even understanding what probability means if
we could get that I would be so excited we talked about that we need to really
have these conversations with our kids when is the good time to do this
I had heard anywhere as young as age 3 we can start talking about rudimentary
money concepts is that true you can start talking to your kids about
anything when they’re little in terms of money every time you have a transaction
it’s an opportunity somebody told me they were buying a refrigerator and they
took their kids with them because the little boy had been hanging off the
refrigerator handle and breaking it and the parents wanted him to understand
just how expensive a refrigerator was when I was little my parents took me to
the car dealership I was about five years old and I watched my dad counting
out the hundred-dollar bills to buy the car in cash what and your father a
mobster no he wasn’t a mobster but they never bought anything on credit ever
ever hears from the website and this is the
money as you grow website there are a lot of things that are Val
some of them cost money and then ask your child to identify different coins
and their value so that’s one thing point out things that cost money
ice cream gas for the car clothing and essentially when you’re out shopping you
can point out essentials like you can talk about here are things that we need
and here are things that we want how about the idea that there are certain
things that you point out that are free what that means in other words playing
with a friend doesn’t cost money but it’s valuable so how do you distinguish
that I like to talk to kids about setting goals because that’s what really
helped me my family talked about what our goals were and what trade-offs we
needed to make to get there and I think that puts the whole discussion about
money in the context of what you want to do with your life and that’s not just
career but it’s the the way that you want to live and spend your time every
day I think it’s you have to be patient around this but you have to keep talking
about it that’s right and I love the shopping example because there’s so many
things you can do in a store with kids unit pricing when they start getting
into more math looking at brands versus things that aren’t branded when things
are on sale I still use my coupons at CVS every chance I get because I love
saving a dollar or ten dollars the thing that I find frustrating and maybe you do
too is that I hear often from some women I’m just not I’ve never been good at
math or I don’t like this I don’t understand this and I find that to be
curious because data show that women are very good long-term investors they are
very good at this if they just stick with it to stick around and learn about
it so how can we maybe shift a little bit more emphasis on women it’s really
sad that the data still shows this because it’s shown this for many years
but it’s true it’s also true for people of color they fair fair worse than white
males from wealthy families but girls are have a special place in my heart
because I started out my career doing math you type things for a financial
services firm so I got I got both financial services and Technology and
the same head in my first job and that served me well so we’re very fortunate
that we’re merging with a regional program that
started up in Boston called investing girls oh cool and that program is
focused on building financial capability for high school girls and importantly
introducing them to the possibility of careers in finance and financial
services through taking them places so that they can see workplaces that look
like places they might want to work and introducing them to role models people
like you you work in finance you need the language and grammar of money to be
successful in your career so we want to show girls a variety of different
careers where our understanding money can be fun and we took good and
interesting careers for them so what’s the name of that we’re gonna say called
invest in girls so you guys are merging we are and will they come in under your
umbrella you’re gonna rebrand with some brand exciting new name their executive
director Betsy Keller is fantastic the program is growing it’s healthy and my
best experience from the private sector doing merger says when you have a great
organization you just let it continue to be great what we bring to the table is
more access to more resources and a great distribution network through our
national affiliates we’ll be talking more about financial literacy with nan
Morrison after this quick break this is Jill on money hi I’m Jill
Schlesinger hosted the Jill on money podcast I’m also a certified financial
planner and a CBS News business analyst I’m here to tell you that the Jill on
Money podcast has a new sponsor Marcus by Goldman Sachs Marcus is part of a
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Marcus offers simple secure access to FDIC insured savings products including
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welcome back to the show and now let’s continue our interview with nan Morrison
so how much of your job is raising money it is a good chunk of my job will be 75
to 80% of my time is spent working with companies foundations individuals to
help us grow some of our great programs like investing girls like family
financial literacy nights like our national personal finance challenge
which is happening on May 10th what’s that that is a fantastic competition
across the country kids compete within their state and then the winning teams
from every state go to the finals and they have a case study that they present
to a team of esteemed judges this year we have about 17,000 kids participating
across the country next year we hope more we’ve been generously funded now by
voya to really grow this competition finals this year will be in Lincoln
Nebraska really give me an example of the kind of people who are competing
them what are they doing in that competition so at the state level that
kids can range from late middle school to high school and they compete in
written exams quiz bowl rounds key studies here’s a family with their
budget how do you help them to get to their goals cool so so there’s a real
critical thinking element of this and the other thing that I really like is
that the kids work in teams so it’s a really great after-school activity
because it reinforces learning because kids who take after-school activities
get their learning reinforced which is great and also it’s a good exercise and
learning how to work in teams which we all know is really important to be
successful in the workplace you know we’re gonna have high school graduation
is around the corner right how much should parents be talking to their kids
about money in this next phase where they’re hopefully going to be attending
some sort of post high school education Community College Bachelor of Arts
whatever what do you want them to go to school knowing and what do the parents
need to really be clear about with those kids sitting down and talking to your
kids about a budget for whatever they’re doing they may be doing some work study
kinds of things they may be at college they may be working while
they’re at college they may be getting an allowance that they have to cover
books going out with their friends so just talking about budgeting what the
child’s goals are for the next year financially and how they’d like to set
aside that money a lot of kids will even if they’re not working during the school
year they’re gonna start working the following summer so starting even to
think about that summer job and how they might allocate some of that money is
also an important thing to do by the way as soon as kids are working they can
start putting money away and two different kinds of IRAs and it’s also a
good habit to start that long-term savings young why it’s a habit you have
it’s just like getting up and going for a run in the morning or brushing your
teeth you just get into the habit of putting a little bit aside from that
very first paycheck into your long-term savings just like your father said pay
yourself first just like dad said so when you look at the landscape of
financial services and I know we have to be politic here because some of these
are your funders I’ll do the talking on this part it does drive me a little
nutty that some of the most egregious hyper selling organizations are the very
same ones that underwrite quote unquote financial literacy so what advice can
you give to parents and even their students but just how do distill
information they get without getting sucked into buying something this just
goes back to what we’ve been talking about all along
knowledge is power if you have the language and vocabulary of personal
finance you begin to feel more confident about asking questions
you know once upon a time in New York City you walked into a store to buy a
chocolate croissant and you just bought a chocolate Quest’s
on and you might be a little shy about saying well I wonder how many calories
that is now we all know so you don’t have to be afraid of asking the question
anymore and you know that you just blew this morning’s run by eating 300
calories of a chocolate quests on 300 I’ll tell you what I think if I got 300
I might be more of those so so I think just just being having the knowledge to
ask questions is probably the most important thing and if
seems super complicated it probably is because when you get right down to it a
lot of this stuff that most people are investing in or doing isn’t that
complicated and you ask a friend ask a family member who you trust if you think
you’re not getting the information that you need don’t be afraid to get up and
walk away and that can be really hard for a lot of people who might be
intimidated by the place that they’re in what is it that you think is is kind of
the big pushback that you will hear from say a school system about why they’re
not teaching personal finance in the in the public school systems that is a
great question the answer that we usually get from them
is there isn’t enough time in the school day and that’s just not true because we
can help schools integrate personal finance into the everyday life of the
classroom it’s such a natural fit in any elementary school classroom we have a
set of materials called the mini economy so kids rent their desks they get paid
for doing tasks it’s great they really learn how money in commerce works and in
junior high in high school it’s really easy to integrate these subjects into
math social studies career technical education classes there are still some
classes about civics and the kinds of things that you and I remember study
they’re called different names now and you don’t learn to sew anymore if you’re
a girl but there are sort of life skills classes workplace learning classes that
are often offered and we can just integrate that right in so you help a
school system let’s say dovetail what they’re currently doing and weave this
into the process in fact on your website there is it says you know you’ve got
different stuff here for parents this that but you also have it for teachers
yes teachers are a big audience and we can help them with lessons with helping
to integrate into the curriculum in fact we have a whole website just for
teachers it’s called econ edie link and that has tons of free resources our
standards are on there teachers can create their own quizzes it
it’s a real educator website and we’re very proud of it we have almost a
million visitors every year so it’s really widely used and we keep investing
to keep up with the needs of 21st century teachers someone said to me who
is in education if they’re not testing for it the teachers will not teach to it
is that true I don’t want to get into that testing debate I would say for us a
lot of the teachers that come to us are teaching in title one schools those are
the low and moderate-income school districts and they come because they
know that this is an essential life skill for those kids you know we spend
so much time trying to help kids to understand that there’s a bigger world
out there to get them educated get them jobs and then we forget to teach them
what to do once they’re earning money and they get into trouble shame on us
yeah that’s so hard so you’ve worked in now nonprofit land for how long nine
years do you miss anything from the private sector it’s just different
sometimes I miss the pace and sometimes I don’t miss the pace yeah I get that
but I think I’ve had a chance to I know this sounds really trite but to really
move things ahead for our organization and take us into new places we have
another competition called the national economics challenge we now have a
license agreement with China so the Chinese students come to the US and we
have a joint competition I guess what’s important here is that I think that
parents feel sort of helpless like oh I have to do this too and so what you’re
really saying is that between parents and teachers cee Council for economic
education can help these folks along with preparing their kids better and by
the way here’s the side benefit if you help your kids through this you’ll learn
it even if you didn’t learn it absolutely so that’s kind of a fabulous
thing when you look back and all of the you know the the years that you have
been in the industry what is it about the industry that you wish were
different wave your magic wand and say gosh I wish financial services would be
blank what is the blank I would say that more
transparency is helpful I took out a mortgage right after some regulations
when in effect about simplifying more and I have to say that it was really
helpful and I obviously was super qualified to navigate through this but
as I read the papers I thought you know I think somebody that wasn’t as
fortunate as I was in terms of having so much education and knowledge around
these topics could actually work their way through these things so I would say
transparency things that are written down so that people know exactly what
they’re getting and written in English yeah and I don’t mean the language of
English but just plain plainly written not financial ease exactly and you know
if you can’t walk into a bank and say what is the interest rate and they can’t
give you a straight answer then you should walk out of that Bank
god bless you man Morrison okay we started the program I asked you your
best financial decision you said paying yourself first now it is you’re exposing
time just us here what was your worst what was your worst financial decision I
forgot to diversify something oh I left an organization and my 401k was largely
in the stock of that organization for a variety of reasons and when I left it
was a great opportunity to say great stock but I should diversify send it to
yourself like you even knew it I knew it and I never got around to it and the
company had a little wobble and the stock price fell by almost half and
you’re an individual investor you cannot possibly get out of the stock that fast
so shame on me and did you end up just selling at the bottom and saying okay
you caught my attention or had to come back already by the time I realized so I
was fortunate that I called somebody that I trusted and he suggested I sell
half and then just hang in there and he actually became my finish one after that
so even you have a new financial advisor domino has all this expertise nan
Morrison she is the CEO and the president of the Council for economic
education in the show notes we are going to put up links to council for econ edie
dot org we want to just commend you for taking this on because it’s a tough task
it’s not as if the the school systems are making it easy although some
are I get it so let’s everyone wake up let’s create more financially literate
children thank you for joining us be very welcome thanks to nan Morrison the
organization is called the Council for economic education we’ll have links to
it in the show notes we drop new episodes every Tuesday and Thursday if
you would like to get on the air and ask us a question all you have to do is send
an email ask Jill at Jill on ask Jill at Jill on our music
is composed by Joel Goodman Marc gelareh sue is the executive producer and the
webmaster you can always check out our website Jill on
we are distributed by cadence 13 the show is presented by Marcus by Goldman
Sachs see you next week you

Author Since: Mar 11, 2019

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