A Solution to Financial ILLITERACY

            I’ve been talking to a variety of people lately telling them that my wife and I are trying to get pre-approved for a home loan. I told my brother in law the other day and we started talking about the process. My sister in law heard and voiced the question to no one in particular “how do you know all of this stuff?” To which my brother in law replied, “Nobody knows this stuff. You just learn it baptism by fire.”

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            That occasion made me think quite a bit over the last several days. That’s quite a demanding baptism if you ask me, to go through that process learning as you go, seeing as it may be one of the most important processes of your life. You would think that most if not all college students would be knowledgeable about these kinds of financial fundamentals and be able to handle their money well, but the truth is we don’t really know much about it at all. I think that it would in the best interest of all if Dixie State College were to take the reins, help out the community by helping its own students, and sponsor a free course in financial basics.

            It would probably seem logical to first say why we need this kind of program at Dixie State College. According to a 2009 survey, www.Credit.com states that “84% of undergraduates admitted the need for more financial management education. Of these, 64% would have preferred some type of financial literacy education in high school and 40% as college freshman.” What an overwhelming majority. I agree wholeheartedly with the 64% that it would be nice to have been taught this in high school. Unfortunately, that opportunity has been lost for me as well as all other Dixie students.  But now is the perfect chance to redeem that.

            A possible overview of the course could look as follows. The lessons could be done once a week for say a 1 hour or 1 ½ hour block, for four to six weeks in a row depending on the subject material to be covered. One to two subjects per night could be taught in the allotted time. The instructor would break the subjects down into basic units and go over each of them. The education could be given 2-3 times per year.

            Lectures could include topics such as creating a basic budget, credit, building credit, credit cards, when to get a credit card, what kind of credit card to get, avoiding debt, home loans, mortgages, pre-applying for a home loan, basic investing and retirement savings, stocks, mutual funds, bonds, reading bank statements, interest rates and how they are compounded as well as the different types, common tax errors, etc. I feel like I personally know next to nothing about most of these subjects, and I would imagine that the majority of my peers do not know much about them either.

This program could be instituted at minimal to no cost for Dixie State College. The college could use any classroom on the campus. While I haven’t looked personally, I believe that someone who is certified would be interested to teach a course if offered the chance. It would be very beneficial to them. Whether it is a realtor, or banker, or CPA, or CFA, based on their personal circumstances, they may have a need to do community service or they may be looking for a chance to boost their resume or credentials. What better incentive than to teach a free community course in finance basics sponsored by the city college? Likewise it would look good for Dixie State College. They would be seen as reaching out to the community to help. This would also look good in a time where Dixie State College is looking to become accredited as a university.

            On the website www.houstoncpa.org there is an example of such a group of CPAs who are offering free financial courses in Texas as community service. “20-20 Power Workshops start in September with weekly evening college-style classes… CPAs present materials, as well as mentor goal-oriented families to increase their income and net-worth by 20% in one year.” I trust that this kind of opportunity could also be found in St. George.

Perhaps a mutual agreement of sorts could be reached between Dixie State College and a local business, be it a real estate office, or accountant’s office. For example, Dixie State College could provide free advertisement privileges to a limited extent at Dixie State College sporting events in exchange for the course being taught. However, whoever ends up teaching should not be soliciting to obtain business for themselves before, during, or after the actual classroom instruction. It should also be someone who is not only educated about this subject but who is also fully capable of teaching and relating the material in an attractive and appealing manner. Know that much of the courses’ success will rest upon the charisma and charm of the instructor or instructors as they teach these rather dry topics.

Even writing this, I can imagine that students being told about this would say, “Hey that’s a really good idea, I think I might go to that.” and then not actually attend when it comes down to it. Therefore, aiming to get students to attend is also key. This would be done through advertising. Advertising in the form of student approaches could be done as service by the student council or other students looking for community service. It could also be done at college events. Incentives could also be provided for attendance. I would bet that if there was to be one or two IPod Shuffles raffled off at the end of each class session, the attendance and interest would both go up. And even if a little money is to be spent on the course (one IPod Shuffle retails for $49.95), is it not worth it to have graduating students at least competent when it comes to managing their money?

            It would definitely be in the interest of the college and its students if such a program existed for it would benefit the students who wish to have this kind of essential knowledge (no, I’m not proposing that this be mandatory, but even that option should not be thrown out) and in turn reflect positively on Dixie State College.

            I admit the suggestions and opinions in this essay are my own and that the number of possibilities in which one could implement this financial course are myriad, however, I would also point out that I am definitely not the only one who regrets having gotten to the point where he’s sitting in front of the loan officer and realizes he knows next to nothing about what he’s doing. Baptism by fire? There is a better, more worth-while way of doing things.