Personal Finance vs. "Important Math"

[BudgetHowTo]

I am an educator for the Pennsylvania public schools. I teach math. New curriculum based on state and national standards, the important math" is constantly being forced down our throats. We then have to push the math based on those standards down our students throats. All the while, the students are asked to make decisions based on their future when they know nothing about finance.

For example, what would be generally more useful, polynomial long division or choosing a career that has a salary to match the lifestyle one wishes to live?

Does anyone have any supporting ideas that personal finance should take priority over traditional math teachings?

[jasonnoguchi]

It is impossible to completely understand finance without a good math background. Sad but true coming from a finance background. Proper fundamental in math is critical to complete understanding in finance and all levels of math are used depending on how deep into finance you go into. There really isn't a clear line on where is "Personal Finance" and where is "Finance". If it is just general personal finance theories that you are talking about, then it is ok to add it to the current cirriculum without replacing math (of course those theories would do little to nothing for an individual as much deeper understanding is needed for actual execution).

[Seeker]

I'm not certain what "traditional math" education consists of, but I can tell you that if you make "math" important to a student, they'd take a much more active role in trying to understand.

In your example, I'm not convinced that careers should be discussed in a math class. Polynomial long division.... in this day of calculators I'm not sure that that's needed either.

Basic math; addition, subtraction, multiplication, division, algebra, geometry, statistics, and the trig, calculus later on are fine.... if needed for their future ventures. Not all students "need" higher math, but everyone (IMO)needs basic math, statistics, and finances.

What age's of children do you deal with?

I'm not sure that EVERY child of any given age are "ready" for financial issues at a elementary or middle school level. And definitely not every child would be ready to make a committment as to what jobs/careers they'd like in the future. At least not realistically. But I do understand what you're saying and I do agree that financial education should be started at a lower level, and continued, and frankly tested in and of itself since it does play such a major role in financial well-being.

Maybe this white paper from 2002 will help:

http://www.treas.gov/press/releases/docs/white.pdf

[ActYourWage]

General math is good. Having said that, you can be Einstein and still be horrible with finances. Math is 20% and Behavior 80% when it comes to financial matters.

[ActYourWage]

Originally Posted by jasonnoguchi

It is impossible to completely understand finance without a good math background.

Not true my friend, my grandfather only finished 8th grade, he did not have what we call "a good math background", yet, he is well off, very smart with his money. Granted, I am sure he had to learn much on his own, but to completely understand finance with a good math background is not entirely true....

I do understand what you are saying, to have a deep understanding of the ends and outs of finance does require a proper math foundation.

[minnie1928]

What scares me is how many times high school kids working part time jobs can't figure up change for a purchase. There's a restaurant nearby where the girl HAS to use the calculator to determine how much change I get if I give her a $20 for a bill that's $18.49. AND, it's not like the calculator is used in lieu of a cash register and supplies a tape for someone to follow when proving out her drawer. It's a cheap solar calculator, no tape, no nothing!

FWIW - I am a product of a PA education and one of my best classes was in 12th grade. At the time (not sure about now) it was required in order to graduate that you take and pass Economics. The teacher was fabulous! He made us use the newspaper to find jobs based on our future goals (college grad vs. tech school vs. no post education), then determine our budgets for housing, food, clothing, etc. Then we got "mortgages" and "car loans" that we paid out of our fictitious checking accounts. We were paid every 2 weeks, etc. I sure hope that they are still requiring this class...

[Broken Arrow]

Well, I did great with Algebra, but sucked at Calculus. I think I am managing just fine with my personal finance.... I know Calc isn't covered K through 12, or at least not in-depth, but....

The point is, especially nowadays with the prevalence of computers, calculators, and even specialized online sites such as Yodlee, Mint, and so forth, you can probably do just fine with only knowing basic math.

[EEinNJ]

Originally Posted by BudgetHowTo

I am an educator for the Pennsylvania public schools. I teach math. New curriculum based on state and national standards, the important math" is constantly being forced down our throats. We then have to push the math based on those standards down our students throats. All the while, the students are asked to make decisions based on their future when they know nothing about finance.

For example, what would be generally more useful, polynomial long division or choosing a career that has a salary to match the lifestyle one wishes to live?

Does anyone have any supporting ideas that personal finance should take priority over traditional math teachings?

So you're a math teacher who doesn't want to teach math? That's very disturbing. It's symptomatic of what's happened to our educational system nationwide, and a big reason why countries like India and China are graduating so many more engineers and scientists than us.

Personal finance is a worthwhile topic, and I don't think we want kids learning it from credit card companies and mortgage bankers, then have the Suze Orman's and Dave Ramsey's clean up the mess. But not at the expense of teaching basic math skills!

When I was a high school student, I hated math, didn't see any point in it. Not many kids do, because they are ignorant of their career choices and can't imagine why they would need math.

Teachers let me slide in high school because I thought I wanted to be a musician, but eventually I got interested in electronics when I realized I had to make a living.

I ended up going to college for electronics engineering, and had to take "make-up" math to get on track. Math was never easy or fun, but I learned to understand it. I got through it, got the degree, and have had a pretty good career for nearly 25 years.

I think that's a lot more valuable than learning how to make change, borrow money, balance a checkbook, even making investment choices. Why? Because when you learn to use your brain to do math, you learn the tools to do these tasks.

[elessar78]

About a year ago I was reading a book entitled "The History of Money" and one of the sections was about the (re)birth of banking in europe. Anyway, famed mathematician Rene Descartes around the same time started teaching bankers mathematics that was relevant to their trade (calculating interest and such). The book pointed out that he never felt that math should be taught just for math's sake. That it should have a practical purpose.

I think if it's good enough for him, it should be good enough for PA public schools

I'll try to find the section and post it when I get home tonight.

[am_vanquish]

I love this topic. I grew up hating math ... I was good at it (really good), but didn't see the point in all of the monotonous exercises. I finally encountered a teacher who emphasized the APPLICATIONS of math and it changed the direction of my life. I majored in math in college & graduated in only 3 years. I now work as an actuary & I do more "math" before breakfast than most people do in a month.

The OP mentioned that "important math" shouldn't be as big of a priority as exploring career options. Math teachers are in a GREAT position to influence career decisions because most of the highest-paying and in-demand careers right now are very math-oriented. I don't see anything wrong with taking a few class sessions to demonstrate the broad range of uses for math (show how a polynomial can be used to determine optimization in Engineering or how insurance companies uses Probability to rate policy premiums). Showing students how the math is used and how much $$$ they can make in these fields helps get their attention. Once they see the applications, it's much easier to tackle the theory. My high-school stats teacher did this in her class & within 2 weeks I decided I'd rather be an actuary than an attorney. Best decision I've ever made.

Someone else mentioned that Math is only 20% of personal finance and 80% is behavior. I find that math is a great tool for demonstrating HOW behavior affects long-term results. Compound interest always gets students' attention. Quantifying the benefits of saving early/often with real #'s has a bigger impact than just saying "it's important to save while you're young." Again, I would strongly encourage high-school math teachers to take a lesson (or 3-4 lessons) to show students how things like compound interest work to demonstrate how detrimental instant-gratificaiton can be.

There are also organizations that teachers can contact to have volunteers come to the classroom to speak with students. I have volunteered to teach Financial Literacy in Economics & Math classes through an organization called Junior Achievement. I have also spoken at Math/Science fairs about careers with heavy uses of math.

[elessar78]

But really I can't think of another subject taught that is more relevant to a person's well being and prosperity as classes in personal finance. How can we live in a capitalist society and not teach the fundamentals basis of capitalism? We teach kids the circulatory system of frogs and the conceits of the Great Gatsby and how to bake cakes in home ec and build coat racks in shop class—but it's in question whether schools should teach how to balance a check book?

If the foundation of a good democracy is an informed electorate, then the foundation of a good capitalist society has to be financially sound citizens. I mean we can all agree that the current economic mess we're in is a byproduct of people living beyond their means. Yes, there was some government incentive brought about by cheap money but if you're well-versed financially you don't go chasing what the cheap money brought.

[mommyof4]

I am a person who feels very strongly that basic personal finances are very important, and should be taught in school. And I do mean some basic skills, such as keeping track of a checking, savings account, knowing what interest is, how to figure it, etc. I am also a math dummy (scored in the 4th percentile on my GRE math subtest, 90-98 percentile on the other subtests), and I can't do a mathmatical equation to save my soul. However, I am VERY motivated to understand personal finances, and I must say that I keep scrupulous records of my financial records, and my checking and savings registers are kept to the penny. Most of my skills are "self taught," and I went through a trial and error time (lots of errors), and I thing I would have saved myself tons of trouble if I had known then what I know now. It would have been great in high school or college if, instead of suffering through advanced algebra (none of which I remember now, anyway), if I could have taken a "practical math" course- one which teaches how to apply math in the everyday world, including personal finance. This would have been so much more meaningful to me, personally. I do not, however, advocate doing away with a more traditional math curriculum for the students who are able to do higher level math courses, too. We have many potential scientists, engineers, etc., who need to have an extensive math backgroud.

[feh]

I feel personal finance should be taught in school, but not instead of math. Math isn't just about formulas and calculators; it teaches how to think logically, which is a vital skill.

[am_vanquish]

I'd strongly encourage those who support Financial Literacy curriculum in the classroom to consider volunteering to teach this material. It is a rewarding experience as a volunteer and it makes a great impact on students when you're passionate about it and volunteer your time.

There's probably other organization out there, but I started doing this last year through Junior Achievement when my employer sponsored one of their programs. It only takes about an hour per week to go to a classroom, share your valuable knowledge, and teach these kids the things you wish someone had taught you.

Volunteer information can be found on their site at: Get Involved - Volunteers.
There's alse information for educators at: Get Involved - Educators.

Here's an example program that they offer for High School students:
Junior Achievement Presents: The NEFE High School Financial Planning Program introduces students to the importance of making wise financial decisions. The program demonstrates the importance of planning, goal-setting, and thoughtful decision-making within the context of personal financial decisions.

Concepts—Budgeting, Credit, Financial choices, Fraud, Goal-setting, Identity theft, Insurance, Investment, Pay yourself first, Saving, Spending

Skills—Analyzing information, Categorizing data, Decision-making, Financial planning, Oral and written communication, Organization, Public speaking, Reading comprehension, Working in groups

[Seeker]

Originally Posted by minnie1928

FWIW - I am a product of a PA education and one of my best classes was in 12th grade. At the time (not sure about now) it was required in order to graduate that you take and pass Economics. The teacher was fabulous! He made us use the newspaper to find jobs based on our future goals (college grad vs. tech school vs. no post education), then determine our budgets for housing, food, clothing, etc. Then we got "mortgages" and "car loans" that we paid out of our fictitious checking accounts. We were paid every 2 weeks, etc. I sure hope that they are still requiring this class...

Interesting, I too had some class like this some 30 years ago, in California public HS, but it was called Real World Education... or something like that.

We used the newspaper, filed out registration forms (to Vote) paperwork and submitted it. We did a lot of play/group financial pretending like you mention.

It was highly educational.

[jasonnoguchi]

Originally Posted by ActYourWage

Not true my friend, my grandfather only finished 8th grade, he did not have what we call "a good math background", yet, he is well off, very smart with his money. Granted, I am sure he had to learn much on his own, but to completely understand finance with a good math background is not entirely true....

I do understand what you are saying, to have a deep understanding of the ends and outs of finance does require a proper math foundation.

Being well off and being knowledgeable in finance is two different matter. One of the top wealthiest person in China today was a rubbish collector just a few years ago and she is now worth over 100million. So, does that make her knowledgeable in finance? not at all. Business sense and finance are two different things. Ask him how a financial swap is arranged and he will probably scratch his scalp off. That's finance.

[jIM_Ohio]

I'd find it hard to explain finances to anyone without an understanding of the following:

Addition-subtraction-multiplication-division and percentages/fractions.

It would be difficult to explain debt and investing without more understanding of
interest rates, exponential functions, statistics, standard deviations, the application of standard deviations to all of above and similar

I see LOTS of people talk about investing on sites like this, yet very few can explain standard deviations and investment volatility together.

think about that...

[PrincessPerky]

Why is it one or the other? Because with the mass education system teachers do not have time to devote to each student a full varied curriculum.

While a calculator can do double or triple digit dividing (polynomial division = many numbers division) they cannot point out when you accidentally hit an extra 3 in there. (though I admit all that texting practice the kids get these days certainly helps with the calculator use...)

Calculators are also generally not at the grocery store when deciding between size A and size B. Your brain on the other hand is conveniently attached at all times.

But then knowing more details about any one of the million careers out there is not quite as helpful as you might think. There are after all TONS of options out there, specializing is over done IMO.

I figure a kid aught to be a jack of all trades, till one clicks. Then one should be a jack of most trades and learn as much as possible about the favorite. Unfortunately in America with the forced education system we have we do not allow for varied time of choosing a trade.

My son asked me the other day when the last time I used algebra was...I asked around, haven't yet found anyone who used it since highschool classes (or teaching) but I still teach it. More for the logic than the actual future need. If he decides on engineering or something he will need it, if not, no big.

Finances on the other hand we talk about when we discuss turning lights off, not wasting water, buying brand A vs Brand B (and the math for which size is cheaper by the oz) paying bills, not eating out whenever we want, and so on.

(there is also of course plenty of other 'home ec' stuff, history, music, art, language, writing, reading, science, ect)

So I don't see why it needs to be one or the other, for a homeschooler, for public education ah well can't help really. You do have limited time and need to keep millions happy....I

[lovcom]

Originally Posted by ActYourWage

Not true my friend, my grandfather only finished 8th grade, he did not have what we call "a good math background", yet, he is well off, very smart with his money. Granted, I am sure he had to learn much on his own, but to completely understand finance with a good math background is not entirely true....

I do understand what you are saying, to have a deep understanding of the ends and outs of finance does require a proper math foundation.

I suspect your students are too young to know what future vocation they'll need.

Do teach polynomial math. It is good and to dumb down math is to allow the current trend of foreigners passing us up big time.

The problem with today's math curriculum is that in comparision to even some 3rd world countries, the USA math is dumbed down, and this is one of many reasons the rest of the world is passing us by.

Financial math should not be emphasized until HS or beyond....get the basics down first, the algebra, the trig, then after that a student will better appreciate the financial math. Lets walk before we run.

[ActYourWage]

Originally Posted by jasonnoguchi

Being well off and being knowledgeable in finance is two different matter. One of the top wealthiest person in China today was a rubbish collector just a few years ago and she is now worth over 100million. So, does that make her knowledgeable in finance? not at all. Business sense and finance are two different things. Ask him how a financial swap is arranged and he will probably scratch his scalp off. That's finance.

Ok. Thanks.