Credit and Debt: Time and the Value of Money

Johann at the Middle School

As the global economy gets more complex, and the average person is expected to know and understand more about their larger role in it, “personal financial literacy” has become a vital skill. In the US, according to the Council for Economic Education, financial literacy has been integrated into public school curricula in almost every state.

Colorado is no exception. My twin sons are in 8th grade this year, at Lewis-Palmer Middle School, and the State of Colorado has mandated that every 8th grader learn about the basics of personal credit and debt in their social studies class. When I heard that the topic was coming up this last week, I volunteered to speak — and my boys’ teacher agreed, and gave me the chance to speak to her four classes.

I talked a little about what investment advisors do, what financial planning is, and how one becomes a financial planner. Then we talked about the actual impact of borrowing to buy a house, for college, and on credit cards — with actual charts and graphs to make it kinda real. We wrapped up with a little discussion of credit reports and FICO scores, and how they impact the interest rates we pay. Oh, and I sprinkled in a few cartoons to keep it from being too boring.

So thanks to the administration at the school, and especially to Mrs Martens, for having me in, and to 120 eighth-graders for paying at least some attention! Oh, and boys? You’d better ace the quiz this week.