TEXT OF INTERVIEW
TESS VIGELAND: Figuring out how to manage your own money is hard enough. So imagine trying to teach it to young people. The demand for personal finance in the classroom is growing. But according to a recent survey by the National Endowment for Financial Education, teachers are less-than-enthused about teaching it. Why? 'Cause they don't know it either. Ted Beck is president and CEO of the NEFE. Welcome to the show.
TED BECK: Thank you.
VIGELAND: Really the upshot of this survey seems to be that teachers across the country seem to agree that there is not enough financial education going on for our kids, yet they are not terribly comfortable doing that education themselves.
BECK: Well they're dealing with a couple of trends and this is really why we sponsored this survey. We were concerned that there was a great building interesting financial education in the country -- part of it recession-based, part of it the idea that kids have to get back to some basics. So we invited a whole bunch of schools of education in 2006 and said, 'Eventually this might end up on your plate. And to the extent that that's happened, let's study where we are.' Because we had been hearing anecdotally from teachers for years where they are teaching basic finance, they're a chapter ahead of the kids. 89 percent of the teachers said kids should get this as part of their education process with an emphasis on high school, but we do not feel prepared to actually do that class work. 69 percent said that they felt they weren't comfortable in their ability to actually teach the standards that states were starting to adopt.
VIGELAND: So what does that tell us, then, about the state of financial education for our kids?
BECK: Well I think that tells us that we have some work to do. Now before we talk about strictly what can be done in schools, there's some interesting research we actually did through the University of Arizona and said who is demonstrating really pretty positive knowledgeable behavior here and what were the factors that caused that? And there were three. First of all, family. The family talked about money, they showed them the basics. They worked with the allowances and balancing checkbooks and all the things that you would hope would be discussed in the home. The second was education, having that foundation course. And the third was having had a part-time job. So we were fairly encouraged by the educational component of that, but I would hate to sell short the parental involvement. We really think that's very key.
VIGELAND: When you say that there are studies going on of how you can have more effective communication of personal finance knowledge, do you have any results of that yet? Any clues that we have for how to get kids both interested in money and knowledgeable about it?
BECK: A key part of it is interactive learning. We learn more effectively, especially as adults, by actually taking actions. One of the pet peeves I have about traditional, financial education is it's kind of like sex education. Is that when you're actually willing to talk about it, you tend to talk about way too much. And so if we could get somebody interested in financial education, we'd sit them down and try to teach them everything from this is how a paycheck works to, OK, now you're in retirement. And at a certain stage your eyes gloss over. So try to do it at appropriate times throughout your economic life rather than just one sit down, I think has been a very key trend in our community.
VIGELAND: For the folks in the listening audience who are perhaps parents, educators dealing with kids and wanting them to have this education, how can they go about doing that?
BECK: Well, there's a couple of things. Talk to your kids about money. And if you're not sure what to talk about, do a little homework. If you've lost a job or if you have a reduction in hours, you've got to talk to the family about it. If you think the kids don't notice, guess again. I moved from the East Coast to the West Coast about 25 years ago, and I was on an earlier schedule and I was used to getting home 7, 8, 9 at night. And I moved to California where the market was different and I got home for dinner. My children proceeded to have a little parade in to talk to my wife after about two months, saying (and this is after an economic slowdown was going on), they said, 'Is dad OK?' And she said, 'What are you talking about?' And they said, 'Well he's home for dinner. Did he lose his job?' And she laughed and said no. But the thing is they had noticed a change in pattern and they hear the news, and they were concerned that we were hiding something from them. So it's an example of if you're open about things and talk to kids about it, they'll get through it. They're resilient.
VIGELAND: Ted Beck is the president and CEO of the National Endowment for Financial Education, and we've been talking about how to get those kids educated with their finances. Thanks so much for coming in.
BECK: Thanks so much for having me.