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The most undertaught subject in America

The Missing Semester - Gene Natali Jr.

EMERGENCY – CALL 911! Dial that number and trained professionals respond. Right? We expect firefighters to enter a building with the proper equipment and training. We expect surgeons and airline pilots to be similarly prepared. They are responsible for lives. So why, in a world in which 76% of the households in our country, our neighbors, live paycheck to paycheck, do we continue to send our students into the real world unprepared to make decisions about money?

Seven million students will take out loans during the 2013-2014 school year. How many of them are being taught how to repay those loans? How many are prepared to respond practically to consumerism that considers 7-year car loans, $3 coffees, $80 concert tickets, 55-inch hi-def TVs desirable, even “normal”? The class of 2014 will graduate with record levels of student loans (nearing $1.2 trillion dollars at last count), as well as credit card debt. They will carry that obligation into a consumer-centric world that asks us to “supersize” nearly everything. Some will become teachers, doctors, engineers, mechanics. Some will drop out. All of them will make decisions about money; most already have made them.

Money is one of the few subjects that affect every American, yet our schools have not, for the most part, addressed it. (In Pittsburgh, as in other cities, there are a small number of notable exceptions.) So how do students gain financial literacy? They probably learn from what others do—that is, from what we, the older generations, do. Not a reassuring thought.

Since we wrote "The Missing Semester," a financial guide for young adults, we have had considerable interaction with this young, ‘millennial’ generation on the topic of money basics. At first we weren’t sure how our target audience, 18-30-year-olds, would receive what we had to say. Our expectations were low because we believed what we had read about this “entitled generation.” But as we began to interact, we found something different. We met young men and women who embraced our message. Individuals, who collectively appear highly capable, highly motivated, and interested in controlling their financial future. Before judging them, we should have first looked in the mirror.

The average college graduate, with an average 2013 starting salary of $44,928, is making more in annual income than 99.63% of the world’s workers (according to In the U .S. most of us aren’t living paycheck to paycheck because we don’t make enough money. We are living paycheck to paycheck because we let our spending dictate our savings. And we have done so for years. Isn’t it likely that the ‘millennials’ are spending more than they make simply because they have watched us do the same for their entire lives? A principal at a local high school said, “Gene, it’s not that my students don’t understand the value of money. Just take a look at the cars in the parking lot. It’s that they don’t understand the preservation of money.”

Given what this generation has “observed,” how can we expect them to act any differently? But they want to and are starting to. And, you are wrong if you believe that this generation isn’t interested in making good decisions about money. A few examples from our recent experience on the school circuit:

• Students at a community college stayed around and asked questions about personal finance for 90 minutes after our brief talk about money decision-making.

• More than 20 students, out of a class of 42, at a university approached a professor outside the classroom simply to shake hands and say thank you for teaching them about personal finance.

• A high-school senior speaking to his entire class prior to our Money 101 presentation urged his classmates to pay attention, because “this is really important stuff.”

• Three hundred and fifty people attended a PA Money Matters conference, on a gorgeous summer evening, . . . to learn about money! Asked why he was there, one high school junior, told me, “it looked cool! ”

Surely there are countless other examples of this generation’s interest in financial literacy. Organizations such as Junior Achievement, Jump$tart and others are working hard to narrow the gap(s) in financial literacy. Progress is being made.

Yes, there are members of this generation who feel ‘entitled.’ But our experiences—those cited here are just a few of many—suggest that this is a group that wants to avoid the money problems that plague so many of their friends, families and neighbors. They want to learn how to make informed decisions about money. And YES, they are capable of doing so. They only need some help. How many of us have had a mentor, a parent, a friend who invested time and energy in helping, explaining, teaching? It’s a cycle that merits repeating, and it’s our responsibility to see that it does repeat. High schools and colleges are logical first steps.