This year I have noticed that financial literacy is often lacking in my client interactions. I have spoken with many people looking to buy an owner-occupied property who do not understand what is involved. Specifically, how to apply for a home loan, how the repayments are defined and what the term “security” means.
So it was pleasing to read the following article from the New York Times. It made me think that here in Australia, we need the same classes.
The New York Times Financial Literacy Classes
Education is the key to Financial Literacy
In my youth, Pink Floyd’s The Wall was a popular album. On the track Another Brick in the Wall, the Islington Green School students sang:
We don’t need no education
Pink Floyd (Waters, Gilmour, Ezrin, Guthrie)
Wе don’t need no thought control
No dark sarcasm in the classroom
Teachers, lеave them kids alone
I respectfully disagree with Pink Floyd. Having grown up in the UK during the 70s when it was in significant crisis with strikes, high unemployment and many economic failures, I do understand the sentiment of the song!
Education is the key to a great future for people of all ages – and there is no reason for anyone to not learn anything!
Having classes in high school that focus students on real world issues such as financial literacy would mean that young adults would be making better decisions about their future. When it comes to buying a home or borrowing what is basically, a small fortune, there would likely be a faster approval. The lenders would consider the borrower as being a good fit for them and may offer a better rate.
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