Paul Solman, a business reporter in Boston for the NewsHour on PBS, put together an excellent piece about educating preschool children about saving. In it, Solman interviews Grover and the children of behavioral economist David Ariely of Duke University, among others.
The piece discusses a research study on self-control among young children, which was covered recently by Squared Away.
Consider these grim outcomes for financial educators:
One study found that the seniors who had the least financial knowledge were most confident about their knowledge;
The most successful educational tools – stock market games – send the message it’s okay to gamble;
When Illinois required consumers to attend a workshop for certain types of mortgages, homebuyers avoided those mortgages;
Scores for national financial literacy tests administered to high schools by the JumpStart program declined between 1997 and 2008;
Soldiers exhibited worse budgeting behaviors after taking a financial course than before.
In the past decade, foundations, governments, and non-profits have poured millions into financial literacy efforts in grade schools through college and among low-income neighborhoods and specialized groups, such as homebuyers and the military.Learn More
Professionals trying to improve Americans’ financial literacy pour time and energy into developing school curricula that will help create a generation of financially competent adults.
But something else we can instill in our children may have a greater influence than education on their financial success later in life: self-control.
A recent study, led by researchers at Duke University and King’s College London and published in the Proceedings of the National Academy of Sciences, found that the self-control children develop as early as age 3 – before formal schooling begins – is a powerful predictor of whether they will save more as adults or will be hooked on credit cards.
“Poor self-control in childhood was a stronger predictor of these financial difficulties than study members’ social class origins and IQ,” the authors concluded. …Learn More
Many parents feel the tension between competing priorities: saving for their children’s college education and saving for their own retirement. Once the kids graduate and move out, the parents rationalize, we’ll really start socking money away.
But do they?
They do not, according to a recent report from Boston College’s Center for Retirement Research, which is affiliated with Squared Away. The report found that parents, suddenly feeling rich after the children leave the nest, indulge by spending 50 percent more on eating out, going to the movies, or buying new clothes.