5 Financial Goals for Teens, Young Adults
The above video qualifies as Personal Finance 101 – one critic dismissed it as nothing more than “common sense.” But that’s appropriate for the audience and worth sharing with teenagers and young adults in your life who are just starting on a financial path.
The speaker, Alexa von Tobel (three years before she agreed to sell her online advisory company to a major insurance company for millions of dollars) provided common sense goals for people who get their money the old-fashioned way – one paycheck at a time.
She proposed these five financial priorities (with minor alterations by Squared Away):
- Follow a budget.
- Have an emergency savings account.
- Strive to become debt-free. Pay credit cards in full.
- Negotiate your salary.
- Save for retirement to secure employer’s 401(k) match.
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I would add, (6) do a video and sell it to an insurance company for millions of dollars.
Actually a lot of states, including Utah, DO requires that high school student pass a personal finance class in order to graduate. Further, a number of public universities, typically the land grant university in each state, teaches personal finance and personal investing classes, including Utah State University where students can earn an emphasis in Family Finance within the Family, Consumer & Human Development major. Other universities that offer similar courses and majors include the U of Missouri, U of Georgia, Texas Tech, Purdue, The Ohio State University, and many other public universities. But the main entity that fails to educate our youth is the parents.
Sadly, while it might seem like common sense, personal finance for any age isn’t common. I didn’t learn it in high school or college. From what I’m hearing from others the same ‘common sense’ older people don’t have isn’t found in kids coming out of high school and college. If parents haven’t learned to manage their money the same money pitfalls are likely to happen to their children. While educating kids is important, educating parents is as important.
Given that 99 out of 100 commercial messages say “buy me and you’ll be happy,” I think there is approximately zero chance that the average person (and by that I mean people of all incomes and education levels) can acquire these skills in school, and only a slightly greater chance that they can acquire them from their parents, who are probably just as clueless. We need to design a system that protects people from their own worst instincts, which are instilled by our consumer culture. Unfortunately, the institutions that do that, eg, Social Security, defined benefit plans, and consumer protection agencies seem to be under attack by both parties, with the exception of the very liberal left, which is great for those of you in Boston, because the lefties all live there. For the rest of our Republic, I despair.
Is it that hard to follow a budget?