Wednesday, December 9, 2015

Giving, Mentoring, and Financial Literacy

This morning, I had the opportunity to attend a breakfast that was hosted by the United Way and sponsored by a central Maryland for profit organization (so that the money did not need to come from United Way donations). I was able to invite guests, and I chose to invite two.  The first is someone with whom I run who is a third year law student at another local university in whose professional success I have taken an interest while I have gotten to know her over 3+ years of marathon training.  The second is a graduate of the Johns Hopkins Carey Business School who continues to look for the best matching full time job whose success is of great interest to me. I believe they both appreciated the invitation and opportunity to network, hear about the United Way, and hear the speaker. I believe it is a critical professional responsibility for me to provide opportunities like this for individuals for whom I have some mentoring role.  And it is just fun to have people I know with whom to discuss the speaker afterward.  

This morning was also great as I had a chance to meet staff from Johns Hopkins Hospital, the University of Maryland Medical System, and other local employers.  And the speaker was Peter Franchot, Maryland's state comptroller.  

He talked about many things.  Working across party lines with the governor was one of the most interesting topics.  But I was most impressed by his discussion of a financial literacy program that was originally developed in Fairfax, Virginia, and has been adopted in Prince George's county, Maryland.  He was hoping that all other jurisdictions in the state would adopt it.

I had a chance to ask him a question and he made a fascinating observation.  I asked whether there was enough long-term data from the implementation in Fairfax to know if kids later ended up with improved overall well-being or a better quality of life.  His answer was essentially that there is a lot of information supporting the idea that financial literacy leads to improved well-being.  He did not think that we needed a big study to know how many of the kids who are exposed to this particular program would retain the information moving ahead.  But he concluded by mentioning that he knows lots of people who make a lot of money but who are not happy as they do not understand how to create wealth, how to gain control of their funds, and how not to spend everything.  Thus, even for those who are highly successful he indicated the importance of financial literacy to give people piece of mind and to give them a feeling of certainty as much as possible,

That was a powerful observation.  And one that I am not sure all high income individuals appreciate.

As an academic, would I like to have a better idea of what proportion of kids retain what they learn in eighth grade ten years later and ask whether there might be an alternative program that costs less to implement and that has a higher retention rate?  Of course, that it the type of question I'd ask as an academic.  But am I just glad that someone in state leadership is promoting this important topic?  You bet.  

And this type of insight is why I like to attend these types of presentations and invite those whose professional development might benefit to join me.  Their future is longer than mine.  Hearing about important public policy, new ideas, and tough decisions (things I have heard about over the years at these breakfasts) will affect their years of work and retirement for more years than I will be affected. 

3 comments:

  1. The main steps to achieving financial literacy include learning the skills to create a budget, the ability to track spending, learning the techniques to pay off debt and effectively planning for retirement.

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  2. Personal financial literacy is more than just being able to balance a checkbook, compare prices or get a job. It also includes skills like long-term vision and planning for the future, and the discipline to use those skills every day.

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