Greece: it’s really all about money management
By Dian Vujovich
Greece’s economic problems continue to baffle everyone from those trying to find a way to correct that country’s economic woes to those trying to get to the real bottom of what happened in the first place to cause the catastrophe. I’ve read a number of stories about both and what it all boils down to is money management. For that reason, this blog is not going to be about Greece, rather, how much today’s college kids know and don’t know about money, debt, saving etc.
Get the young people of America to be savvy personal money managers and there is a reasonable chance that those who move into the political arena will have a leg up on managing our nation’s financial resources and debts in the future. Moves that could help us avoid a Greek kind of financial mess. And more importantly, make their individual personal financial lives more fruitful.
America’s ugly money truths…
In a just released 2015 U.S. Bank Students and Personal Finance Study that asked 1640 students how successful they were at managing money, the grade they gave themselves was a “C” or below. Ouch.
Making matters worse, 91 percent of them said that they had learned about money from their parents either directly or by example. On that score I’m going to give their parents an “F”.
There were 12 questions in the U.S. Bank’s survey. Below are some of the results along with my corrective commentary:
• 21 percent said they were barely keeping up with day-to-day expenses. Only five percent said they were prepared for unexpected expenses. I say: Kudos to those five percent.
• 44 percent admit they have no knowledge of creating and maintaining a budget. I say: How stupid can you be? A budget can be as simple as taking a sheet of paper and writing down all your monthly expenses in one column on one side of the page and your income of the other. Then add the total of both columns. The goal is to have the income column tally equal more than the expense column. This isn’t tough people; it’s simple adding and subtracting math. Once you’ve got it, show your parents how to do it.
• 63 percent of students think 401k investments are guaranteed or don’t lose value. I say: Listen Up! There are risks in every investment and guarantees within the financial arena either don’t exist or come at a cost.
• Over 60 percent said that they had little to no knowledge of investments or retirement savings. I say: Really? Does your family live under a rock? Investment and financial education exists everywhere—in TV commercials, on zillions of apps, on the Internet. Furthermore, where are your parents on this subject? If you aren’t all communicating about this very important gotta-have-money-to-live subject, it’s time to start right now.
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