Growing up, I was historically bad at math. While most people at my high school were taking Trigonometry and Calculus, I opted to take what was known as the remedial option: Financial Analysis. In this class, we learned an array of useful skills: calculating the actual price of an item when there is a sale price, calculating loan interests, and filling out practice W-2 tax forms, among others. Our final project was simulating a month’s expenses based on a randomly drawn salary, looking at rent prices for apartments near our college, tuition, groceries, and other bills. We had to consider if all our needs were met and if not, what we needed to do to make ends meet (e.g: living with roommates, taking the bus over having a car, etc.). While none of us really liked math, a lot of us were engaged in this class, because it was information we knew we would need down the road. Out of all the classes I took in high school, this one is one of the few I remember well.
I am thankful for my “easy” math class because I know it’s not the norm for high school students to learn about taxes. In fact, financial literacy isn’t really introduced in US education at all. Honestly, I can understand the hesitation. It is difficult to generalize a topic that greatly varies case by case, as financial situations do. It doesn’t help that money can be one of the most emotional topics there is. In fact, more fights about money in marriage are correlated with a higher chance of divorce. I will say that while fighting is normal, the fights my parents had that stick out the most to me had something to do with money.
These anxieties do not outweigh the potential harm of not talking about money. Not being able to discuss salaries with colleagues perpetuates gender and race wage gaps. Lack of financial literacy allows loan companies to charge more, and often to individuals who are less able to pay back the debt. To put it simply, not talking about money often benefits those in power as it allows them to disenfranchise those with less power and get away with it.
And yes, specific conversations about wage gaps and banks and predatory loan companies are especially important, but discussing personal finances can also help fight against the taboo. As a college student, this type of conversation usually comes up with friends. We all have a certain lifestyle based on how much money is available to us, and it definitely affects the friendships we make. How many times do we lie and say we can’t make an event or an outing when really, it’s just too expensive? Are we upfront with our friends when we say we can’t eat out as often because it doesn’t fit into our budget? And that’s only the beginning. I think it’s safe to say that most of us don’t discuss our saving plans or our budgets out in the open, and we don’t have to. But we should be able to say something like, “Hey, I’m trying to save some extra cash to pay off student loans, so I can’t spend much on entertainment this month. I’m down to do free/low-cost activities, though,” and not feel shame.
I also strongly encourage every college student to start doing some research about finances. I started just by looking up things that I knew were important but I didn’t know how to go about doing. For example, I know that I will need an emergency fund, but how much money should I put aside? (In case your curious: it depends on the person, but some people recommend around 3 months of expenses). There are a ton of free resources available to help us understand the “basics.” One of my favorite YouTube channels is The Financial Diet. They have short videos that explain in layman’s terms things like emergency funds, sinking funds, retirement plans, investing, budgeting and more. They also have a new podcast where they specifically resist against fear about talking money, as they invite guests on to discuss their own financial situations and how their childhoods, emotions, and other life situations have affected their journey of financial literacy. One thing that I like especially about this podcast is that some guests feel comfortable enough to actually talk real numbers, and are forthcoming about their income, debt, and big purchase prices. I really recommend this podcast if you’re interested in how life circumstances and attitudes about money intersect. There are also tons of websites and forums that give advice on different financial topics. You’ll find a lot of different opinions (as with everything), but the more research you do, the more of an overarching understanding you can reach about topics that strike fear in many. Before reading anything on finances, I was afraid of the day I would have to open any other account besides my checking account, I would never be the person to have investments of any kind, and the stock market was far too complicated for me to understand. Now, I know enough to have the confidence that I will be able to open and manage accounts and investments when the time comes.
If money is something that makes you anxious, part of the reason may be the murkiness surrounding the topic. The good news is, we are at the perfect time in our lives to start gaining an understanding of how money moves in this world. Understanding the big terms in our student loans is a great start. The more we discuss money, the more we keep the money in our hands and not in the hands of people who do not have our best interests in mind.