Financial Literacy For Foster Kids (and for me too)

For all the questions about when algebra is ever going to come in handy, it seems clear that many Americans could be more math savvy in general when it comes to personal finances.

I know I could.

I'm hoping that when I'm done with Algebra II, my 401k portfolio will read like a grade school primer and my monthly bank statements will always be comfortably in the black. I know that algebra may not be exactly the right kind of training for this, but a little more numeracy could not hurt.

A few more math classes could not have hurt all the people who signed on to subprime mortgages or who are trying to understand the front page of their newspaper with its complex explanations of the causes and effects of this recession.

I wrote a story for today's paper about a financial literacy program for teens in foster care. These teens have an especially difficult time taking their first steps into adulthood and financial independence. But they are not alone.

By Michael Alison Chandler  |  November 20, 2008; 4:28 PM ET  | Category:  Math Literacy
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I know a number of highly educated people who are now "upside down" on their mortgages not because they couldn't do the math but because they were simply greedy. They either bought houses they couldn't afford in the hopes that the value would appreciate before they had to start paying back the principal or they did a cash-out refinancing of their existing mortgage so they could blow the $ on luxuries. The problem wasn't financial illiteracy but rather the irrational belief that real estate values would keep going up at a double-digit pace indefinitely...

Posted by: CrimsonWife | November 20, 2008 6:46 PM | Report abuse

Financial literacy is certainly a class every student should have before they graduate from high school but it needs to include a good introduction to basic statistics. Too many adults have no clue when presented with statistical data in popular media as well as in financial documents. Maybe if they knew what was going on, fewer people would waste their money on the lottery.

Posted by: tstahmer | November 20, 2008 8:40 PM | Report abuse

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