Cash News
Great news out of PA. The state just made it a requirement for high schoolers to take a financial literacy course in order to graduate. It’ll start in 2026 and PA is one of 25 states to do it, according to Maddie Hanna at the Inky. How crazy is that? 25 states before Monday didn’t make it a requirement to teach us how to balance a checkbook or tell us when we got our first job you should contribute to your 401k immediately. I just opened a money market account. I’ve been leaving free money on the table for years while it accrued .00000001 interest in my savings account. Instead we learned about biology and calculus, which maybe 10% of my graduating class uses today. I took the Inky’s financial literacy test just to see what it looks like when a child is left behind:
PA just made personal finance classes a requirement to graduate high school.
So @CBKylePagan took the @PhillyInquirer’s financial literacy quiz to see what it looks like when a child is left behind pic.twitter.com/3pFVQbulaM
— Crossing Broad (@CrossingBroad) September 3, 2024
Disclaimer: I went to Temple University and left with a degree in Marketing and a 2.6. My answers to this quiz do not represent the fine institution that was the FOX Business School.
Lets get into the quiz.
Question 1: What is a credit card?
This one is a no brainer. I’ve had a credit card for years. Got myself into credit card debt. Climbed out of it. Back in. Back out. It’s the circle of credit card life. I only needed that high interest payment to hit once to scare me straight. You start off chasing that total spending reward when you first open one completely forgetting you have to pay it all back after. Than you get interest tacked on to that and you’re fighting for your life until you get it under control. It’s like Aaron Nola cruising the first three innings then getting smacked in the face during the Rav 4th.
1 for 1.
Question 2: If your employer offers a 401(k) plan, when is the best time to start contributing to it?
Another softball question. I think everyone knows the answer is “as early as possible,” regardless if they do it immediately or not. I don’t know how many college kids read the blog, but trust me, contribute immediately. I don’t care if you’re getting paid near the poverty line coming out of college. 99% of us were. It’s free money and if you never have it then you can’t spend it. Take advantage of the match, too. The match is your friend. Your company is going to screw you on so many things like bonuses and raises throughout your time there. They’ll substitute Friday pizza parties for the raise your boss promised. The 401k match is like the only level playing field you have against the soul-sucking corporation you work for.
2 for 2.
Question 3: Which of the following is NEVER a step in writing a check?
Here a tough one. Remember we were never told how to write a check in high school. I think I had a basketball coach help me one time write a check my parents signed for like our team shoes or something. Without that guy I would’ve been lost maybe forever. Now, obviously with Venmo and CashApp checks are basically nonexistent. I think I need a check for first and last month’s rent and when I use a voided check for a new job. Besides that, birthday and wedding gifts have become a card and Venmo. And sometimes you don’t even get a card. It’s awesome. I hate cards. They just collect dust on the fridge. Send me a text and a Venmo and we’re all square. By process of elimination we can determine writing your name in the upper left hand corner is the right answer.
3 for 3.
Question 4: What is NOT in your credit report?
How the hell should I know what is in my credit report? I get the email every week and don’t even check it. I just know that sometimes it goes up and sometimes it goes down. As long as it’s chilling in the 750-800 range I’m cool. That’s why it could be anything. History of debt payments? Standard. Personal references? Why not. Have I gone bankrupt, been areested, or sued? I think two out of three of those are okay. Personal info? Of course. Drumroll please…..
Shit. The first one we slipped up on. The more I think about it, the more I’m kicking myself, but I still think history of arrests shouldn’t matter. Being sued and gone bankrupt? Absolutely. But if I got arrested back in college cause I had too many beers on White Girl Wednesday that’s my own personal business. The only thing that makes sense why my FICO score should get dinged is if I pulled a check fraud scam on Chase Bank because I saw someone do it on TikTok.
Question 5: What is a good way for a teenager to build credit?
Buddy how should I know? My parents were too busy trying to build their own credit, screw trying to build their son’s. My dad would come up with his half-baked business ideas and then all of a sudden there would be like 20 vending machines in the garage. What did my dad know about vending? He knew A6 was always Doritos. After that? Not much. Pretty sure my mom has sworn off credit cards for like two decades. So if you had a good credit score by the time you got your Learner’s Permit, fuck you, fancy pants.
Still got it right though.
Question 6: What percentage of your income do some experts recommend be spent on housing?
This was a doozy. I’m currently a renter. I’m starting to think I’ll rent for life. I’m in no rush to buy a house because I think my generation won’t have starter houses like the last one had. One day I’m gonna finally get my ass into gear and start saving enough money to empty out my bank account again on a place, live in there for 40-50 years, and croak in the La-Z-Boy in the basement after the Birds lose a heartbreaker to the 7-15 Giants. Yes they’ll be playing 22 games a season when I’m dead.
Still, I always thought 20% was the low. According to experts I’m going to need another 5%-10% of that?? How does anyone afford anything nowadays? This Fishtown house is going to be on the market forever.
Question: Which of the following is true of overdraft protection?
No reason I should get this wrong. I am the king of overdraft protection. In college I used to be on the phone with my bank every two weeks pleading with them not to ding me because I over-drafted at the OD over the weekend. Nowadays my overdraft stories are so much more boring. Now I overdraft because I miscalculate rent and credit card bills and forget when that monthly Roth-IRA auto-enroll payment comes out, plus Venmo payments from the weekend or weddings take 24 hours to come out of your account. It’s a clusterfuck and my math skills are shit. No wonder I got this wrong.
Question 8: Which of the following do most experts agree is “good debt?”
Good debt my ass. Having $50k in student loans because of an art degree is not “good debt.” A business degree with that many loans barely qualifies as good debt. Kids graduating now are firing off a hundred applications before someone with a pulse gets back to them. AI is stealing half their jobs. We gotta fix college and I say make it a two year school. Enough of the bullshit courses we take Freshman and Sophomore year. I don’t need English 101 or a language. Give me the core curriculum and lets call it a day. Even if someone wants to take a gap year or two because they don’t know what they want to do you can still graduate by 22.
Question 9: What is the difference between a subsidized and unsubsidized student loan?
I had no chance at this question. Once you throw subsidized and unsubsidized at me it was curtains. This is coloring the bubble on “C” during SATs because it’s right in the middle, hoping you somehow get it right.
Question 10: What describes a money market account?
I actually just discovered what a money market account was thanks to a wealth management advisor we met during an episode of Men At Work. I can’t believe I left my money in a savings account, getting zero interest this entire time. What an idiot.
Lets see the results…
Not great. But as a kid who never took a financial literacy course in high school I’m going to chalk this up as a win. I’m an example of what it looks like when you don’t teach kids financial literacy. Happy to be the martyr for a more financially independent future.
Kinkead: This should have been mandatory 20 years ago. I’m 39 and they taught us about Adam Smith and “The Invisible Hand,” but not a single person came out of Boyertown Area Senior High knowing what the fuck a mutual fund is. We had no idea how to use the stock market, had no clue what a ROTH IRA was, and knew less than zero about escrow and amortization.