Yesterday as I was getting my haircut by a nice lady who has cut my hair once or twice before. She is probably in her late 50’s/early 60’s, and after exchanging the usual pleasantries the conversation took an unexpected turn. She asked what I did for a living, so I mentioned I work in marketing for a finance company. She quickly interrupted:
“Like a financial advisor? I am in need of some advice”
I let her know that I am NOT a financial advisor, however I do enjoy discussing investing and have a blog about personal finance.
What she said next – I couldn’t believe.
“My car dealer is offering me a new car for 5.5%, it would be for 7 years do you think I should do it?”
Before I could even mention that 7 years is a long time to finance a car – or that she may be able to get a lower interest rate through a different lender – or ask about her overall financial situation, or determine if she even NEED’S a new car- she continued:
“They said I could trade in my current car for this newer one, and the payments would only be a little bit more since my current car loan is 16%.”
After explaining that a 16% car loan is INSANE & basically like buying a car on a credit card – I offered some advice about refinancing, home equity loans, debt consolidation and more.
Although I am not sure if she will take any of my advice – it got me thinking about a much larger issue. Financial literacy/education seems to be incredibly low among the general population – which is crazy considering we are living in a time where there is so much information available to us.
When I was in high school there were 3 types of math you could take.
- Pre Calculus
- Applied Mathematics
- Consumer Mathematics
If you asked anyone in the school (students or teachers) what they thought about each course – this is overwhelmingly how they would respond:
- Pre-Cal is a must take – it is required for most university courses – focuses on “algebra and number, measurement, permutations, combinations and binomial theorem, relations and functions, and trigonometry
- Applied Math – required for post secondary programs that do not require the study of theoretical calculus. Topics include: Geometry, Measurement, number relations & functions and more.
- Consumer Math (now known as “Essentials Mathematics”. I kid you not, people used to call this “retard” math. First of all – I hate using that word – but I just wanted to stress how backwards our curriculum and general thinking on what is important/essential. According to the government of Manitoba website this course is best if you do not require further studies in advanced mathematics. This course focused on: Interest rates, amortization, budgeting, taxes, compounding & more.
Now don’t get me wrong – I am not saying that Calculus isn’t important, or that there aren’t certain careers that will require you to learn these things -but every single person – in every possible career choice at some point in their life would benefit from taking Consumer math. The problem is – the majority of students don’t – and are in fact encouraged to take one of the other 2. When I was in high school I ended up taking Applied Math & Consumer math – and although I think the consumer course was probably too easy it should be a required course for all students (perhaps while also making it more challenging).
I can only hope that things have changed since I was in high school – but looking at the government of Manitoba’s website – it doesn’t appear so. I am not sure what the solution is, and I am not even sure if this is problem all across Canada or just in Manitoba but I am pretty confident – without a shift in the way we educate children/teenagers on finances, budgets, economics and critical thinking – we will continue to have situations where our hairdressers are telling customers about their 16% interest car loan – and that is quite frankly depressing.
Just curious if anyone has any feedback on the high school’s they went to – or are currently going to. Have things changed?