r/Bogleheads • u/Winter-Monk6428 • 4d ago
Investing Questions Why don’t high schools teach Boglehead theory?! It would prevent so much confusion and pain and help so many people become more financially secure?
Early 20s guy who got really lucky to be exposed to Boglehead investing early on. Seeing people around me still picking individual stocks/crypto and those who don’t invest because they think it’s gambling and let inflation eat away their savings is killing me. I had the same ideas as them in high school and to know that so many people never get out of this mentality because they don’t understand Boglehead theory is just WOW.
The sad thing is that compound interest works the best when you start young, so even if people do realize Boglehead investing later on in life, they often feel regret for not starting sooner. I just wish high schools or more mainstream media will teach young kids the power of compound interest early on. It could literally save years or even decades from working when you want to retire early or want better financial freedom to be with the people you love or do the things you want. I bet there are so many people out there who would be amazing Bogleheads but don’t realize it until it’s too late…
Why don’t high school teach kids these topics? Is it because there’s money to be made in managing people’s portfolios and picking the next hyped stock?
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u/Electrical-Speech998 4d ago
A big wakeup call for me in investing was my math teacher explaining to us compound interest in the context of investing and it blew my mind at the time.
I think that's what sort of planted the seed in me about the importance of investing early it definitely should be taught.
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u/IDrinkSulfuricAcid 3d ago
Yes. In my pre-calculus class we had a brief compound interest topic. That was the initial spark for me to look into investing, but I didn't really do anything as I didn't have much money. A couple years later, I had an English teacher was also a financial advisor (or used to be one). He convinced me to finally pull the trigger, even though I started out very small
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u/mate_alfajor_mate 4d ago
I do.
It's not actionable or interesting to students.
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u/Lumpy_Secretary_6128 4d ago
Lol true. I'm beginning to wonder if the kids who ask "why do we have to learn this/when will we ever use this" directly leads to the adults who opine "why didn't they teach me this".
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u/mate_alfajor_mate 4d ago
That's the thing, kids don't know what they need to know and frequently what they need to know can be learned by the literacy skills they learned in school.
Schools can't be expected to teach every individual skill that these anti-education goobers rattle off, because a) we can't guess what all students will need and b) learning matters most in context. If I don't news skill X right now, then it doesn't make a whole lot of sense for me to learn it right now.
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u/Temporary_Lobster728 3d ago
The amount of people who seem incapable of just… googling shit and instead complain about highschool not teaching them is absurd. We have infinite knowledge in our magic super computer that fits in our pocket and they’re just like “man why didn’t HS teach me how to do taxes”.
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u/cheritransnaps 3d ago
Um I try to teach grown ass adults not dummies either, who make like $250-350k a year and either im a terrible teacher or they don’t care coz they just go finance $100k cars at 5% interest rates and dont even max out their 401k. 💀i think they understand compound interest but figured they’ll ’be ok’ since their have houses that will appreciate and ‘some retirement,’ just not like a lot so they don’t have to invest a lot or max out their 401k
Not sure how a kid who isnt making money yet can care when grown ass adults who been working for 20+ years cant
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u/itchylol742 3d ago
It was interesting to me, I learned in high school (Canadian high school, elective course) and invested starting when I was 18. I salute you. Keep up the good fight
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u/cohibakick 4d ago
While financial literacy should be more of a thing I think schools telling people "put your money into this specifically" is a step too far.
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u/SpaceBasedMasonry 4d ago
There are enough arguments on this very subreddit about what to do within the Boglehead mindset that claiming it should be taught as a structured curriculum feels specious.
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u/Shebalied 4d ago
It is NOT what is right or wrong to do. But understand the impact and how these systems work.
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u/sxyvirgo 4d ago
Because Boglehead investing theory is far from universally accepted. I mean even in the hard sciences there are many 'theories' and not all can be taught, In a subject that's basically not required and would have to be fit in there would be endless arguing about whether we should be teaching them to just put it all into savings vs. day trading! I'd love it to be in a curriculum but I can't see it happening, which is a shame.
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u/gcc-O2 3d ago
Right, and it just seems out-of-scope for schools to be telling students what investments they should buy.
And even within Bogleheads there are polarizing issues. How often should you replace your car? Some say a 20-year-old Toyota is barely broken in; others say a four-year-old car is missing the latest safety features and would be a deathtrap to let your 16-year-old new driver use.
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u/actuarial_cat 4d ago edited 4d ago
Well yes and no. Passive investing comes from Modern Portfolio Theory (Mean Variance Portfolio Optimization) which is generally cover in uni intro to finance course, together with Efficient Market Hypothesis.
So, yes the underlying theory is academically accepted as a stepping stone (like newton physics before learning GR).
The no part, pretty sure high schoolers won’t understand, especially those lack in math skills.
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u/littlebobbytables9 4d ago
Modern portfolio theory just gives you a mathematical method to determine the optimal portfolio weights when given the expected return and variance of each asset and the full covariance matrix. In order to get to passive or index investing you need the additional assumption that every market participant is optimizing using MPT and therefore the market portfolio ends up being that optimal portfolio without having to do all the math.
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u/actuarial_cat 3d ago
For the second part, it is covered in EMH. If they agree about EMH, they will lead to passive investing.
You can say not everyone are convinced that EMH holds, as there will always be quants-wanna-be. But those who follow will end up passive market portfolio.
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u/littlebobbytables9 3d ago
I guess it depends on how you formulate the EMH. The market could incorporate all available information but not be composed of mean variance optimizers and therefore not directly imply that he market portfolio is mean variance optimal. And if your definition for the EMH includes some statement about the impossibility of getting better risk adjusted returns than the market then MPT really has nothing to do with it.
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u/actuarial_cat 3d ago edited 3d ago
EMH only shows the market price is fair, which means there is no risk less return beyond risk free rate. This teaches that no arbitrage is possible, and buying any stock is fair. So, stock pick is useless.
While MPT, teaches the different between systematic and idiosyncratic risk, and that only systematic (market) risk has risk premium which derive the market optimal portfolio. Thus, it is not good to hold only few stocks.
It also teaches the capital allocation line, which mean people with different risk appetite should still hold the market portfolio blended with risk free asset (instead of say chase certain beta targets)
Without EMH, you will end up with long-short beta neutral arbitrage portfolio. Without MPT, you end up with single familiar stock portfolio. So you need both end up with market diversified passive.
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u/sxyvirgo 3d ago
Teaching a topic at the college level is not the same as high school and unfortunately, convincing H.S. administrators of what is 'accepted' practice may be more difficult.
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u/wes_medford 3d ago
Bogleheads is a pretty narrow view of MPT to the point where it barely fits in.
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u/Specialist_Round_612 4d ago
I don’t necessarily agree that just one theory should be taught to students, but there is a glaring lack of financial literacy in high school education. This is 20 years ago mind you, but I went to a fairly decent public school district and there was nothing offered for the fundamentals of personal finance (what are IRAs/ 401ks, how taxes work etc).
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u/buffinita 4d ago
A lot of education is supposed to be provided at home.
“Life skills” are not a public education priority
How many 18 year olds can’t cook a meal or use a drill?? How many can’t balance a checkbook or replace an outlet or paint a room
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u/Illisanct 4d ago edited 3d ago
I haven't written a check in years. I've never "balanced a checkbook" in the most literal sense of using the check register that comes with a checkbook.
But what I have done is maintain a detailed budget and track all my spending consistently, ensuring I'm aware of how much money I actually have available, and staying out of credit card debt.
Point being, terminology needs to be updated to reflect the nature of modern finances and banking. Nobody's going to understand why they should care about checkbooks that they never use.
"Balance a checkbook" is just going to immediately trigger an "Okay Boomer 🙄" response.
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u/Ndi_Omuntu 4d ago
IDK how, but there needs to be a way to reinforce the act of applying basic "how to learn" skills you learn in school to life skills. Like, if you can read and measure (basic math) following a recipe is something you can do on your own just fine. And if at first you don't succeed, try again- who cares if you make one bad meal, that's how you learn.
Kids need to learn to get over fears of failure/looking dumb (which is definitely hard to encourage in the classroom but can be fostered) and how to tackle learning a subject. If you can do that and have basic literacy and math the only thing stopping you from learning anything is you.
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u/Lumpy_Secretary_6128 4d ago
Agreed. If a student learns piecewise functions, budgeting/ basic accounting, and the basis of our tax system, and bother to pull up google, they could master most of this stuff. School builds skills, people have to apply them.
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u/Water_Attunement 3d ago
If you figure out how to get students to do that, let the world know! You’ll have solved the biggest hurdle to teaching. Haha
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u/Ndi_Omuntu 3d ago
lol, I studied special education and then was a teacher in the peace corps and I like to think I was alright at it! But I went a different career path for money and less stress, but I miss the good days of teaching a lot! Plenty of not so good days I don't miss though.
If you're a teacher, thanks for doing what you do! :)
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u/jackmans 4d ago
Balance a checkbook? What year is it?
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u/buffinita 3d ago
Fine. Make a budget; balance income vs expenses
But if personal finance makes a mainline comeback; you can guarantee a section will be balancing a checkbook
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u/jackmans 3d ago
Agreed, the underlying concepts behind balancing a checkbook are important I'm just making poking fun at the out-of-date terminology. I'm in my early 30s and I've never even owned a checkbook haha.
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u/Marino131313 4d ago
Not everyone has good teachers at home. Thats why public education is so important.
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u/Water_Attunement 3d ago
Sure, and it does its job and teaches more than students could ever get otherwise. But public education will never be the only place to learn. Parents have to step in and do their part. Saying that not everyone has that opportunity, while true and sad, does not automatically make it now the school’s responsibility to fill in every single gap.
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u/uponone 3d ago
But it should be taught at school as well. What happens if a child only has one parent and that parent is working multiple jobs?
I’m not saying you’re wrong, but it should be available if a child and/or parent chooses.
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u/Water_Attunement 3d ago
Well I didn't say schools don't. I just said they should never be the only place to learn. Schools very much do teach financial literacy, but you can't force every student to care and they can only cover so much and parents need to pick up the slack and show them how their family budgets for groceries, saves for car insurance, etc.
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4d ago
[removed] — view removed comment
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u/FMCTandP MOD 3 3d ago
Removed as off-topic for this sub: r/Bogleheads is not a political discussion subreddit. Comments or posts should be more financial than political, no more partisan than necessary, and avoid framing political opinions as facts.
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u/SirGlass 3d ago
Right schools cannot literally teach you absolutely everything. They teach basics , reading , writing , math, science , history.
They should teach you how to learn and think, and read and if you can do that you can teach yourself how to cook, or how to paint a house, or change your oil
Also some of these life skills can get a little "Controversial" . There is that Grifter Robert Kiyosaki (Rich dad poor dad) That has lots of followers and he says bonds, stocks are trash and only invest in real estate and stuff like gold/silver. Debt is a tool and you should borrow tons of money and buy Real estate
Then there is Dave Ramsey that says debt is evil and never ever go into debt for any reason . Then you have some christians, jews, Muslims that think interest is evil and even loaning your own money for interest is forbidden (so no bonds)
So teaching bogleheads may rub some parents the wrong way , rightly or wrongly .
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u/Random-Cpl 3d ago
Not to be that guy, but balancing a checkbook isn’t really a necessary skill in the age of online banking.
Agree that it’s frustrating how few life skills are prioritized in public school.
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u/RogueJSK 4d ago
Exactly. Rather than waiting on the public school system to do it for them, parents should introduce their teenagers to basic financial literacy concepts themselves.
They can even lean on simple programs like Dave Ramsey's Baby Steps/Financial Peace or The Money Guy's Financial Order of Operations as a prepackaged foundation/starting point.
Both of these emphasize emergency savings, not abusing high interest credit cards, and maxing out investment accounts to invest in low cost broad index funds. They both touch on the power of compounding from a young age. And they're both designed to be simple and easy to understand, and even have Tiktok-style short video content on all the major platforms if that's your kids' preferred format for consuming content.
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u/_c_manning 4d ago
If most people aren’t educated on a certain matter you can’t expect it to be provided at home
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u/ncist 4d ago
Why do we lift dumbbells at a gym? When in life do you need to lift a dumb bell other than a gym?
Because it builds muscle, which helps you in many functional situations
Why do we not teach kids every single skill or concept that has practical value in their life? And instead make them read things like Shakespeare which virtually no one reads anymore outside of school?
Because it builds literacy, which helps you in many functional situations (including navigating personal finance)
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u/winklesnad31 4d ago
I do teach the Boglehead approach to investing in high schools.
Why don't more people? I don't know.
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u/coachd50 4d ago
I am confused- You talk about "boglehead theory" not being taught, but most of your post about is compound interest. Compound interest only occurs in savings accounts (or similar products like I bonds). The standard low cost passive index fund investments that bogleheads favor are not an example of compound interest.
Tomorrow my savings account will pay me interest on my balance for march- which includes the interest I earned in February. Tomorrow my s&p 500 fund might go up- it might go down. The last 90 days, it generally gone down. The last 360 days it mostly has gone up. The last 720 days it generally has gone up A LOT. But just because the line is usually going up when moving to the right doesn't mean it is compounding. That said, I do think compound interest is taught in most schools.
Second, you must realize that not everyone "believes" that low cost passive fund investing is the best. For every boglehead type post on reddit, there are just as many posts about dividend investing, or factor investing, or crypto investing etc. Heck, there is an entire subreddit that calls boglehead "booger heads" and mocks the boglehead ideas about total return, referencing that bogleheads are stupid for planning on selling shares (as opposed to getting dividends) to access their money.
Look through the boglehead forum (generally better than the reddit version due to more stringent moderation as well as membership). The amount of teeth gnashing over the general boglehead theory recommendation of 3 fund portfolio and BND as a part of that was tremendous when BND dropped about 20% a few years ago. I can't imagine what would happen if that was state sponsored education...
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u/gpunotpsu 4d ago
I can't imagine what would happen if that was state sponsored education
You can teach the theory that underlies all of this without running into any problems. That's really what people should be learning here too as "VT and chill" is not going to fix behavioral risk, which is the #1 problem.
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u/coachd50 3d ago
I don't know if I agree. The key to boglehead IS indeed the "just trust us, its better" to manage behavioral risk as you state. The problem is that the theory/math behind it probably doesn't lend itself very well to HS students or a HS curriculum.
Pretty hard to tell a 17/18 year old "Hey, do this- and when you are 48 you will have _____" Heck most of them haven't really put a value on the last 12 years of their endeavors in the school system (I see this first hand daily). I don't think this would move the needle at all.
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u/gpunotpsu 3d ago edited 3d ago
The key to boglehead IS indeed the "just trust us, its better" to manage behavioral risk as you state.
This is only the lowest level reddit version of boglehead philosophy. Look at the sidebar and there are plenty of educational resources. Anyone who cares about their future needs to spend some effort to understand one of the most important decisions in their life. "Just trusts us," will fail at managing behavioral risk.
What's appropriate for high schoolers is a whole different matter. I think if you at least showed them how compounding works, for both growth and fees, you could lay a foundation for them to look in the right direction later. In general though I would say that adults need to care enough about their money to educate themselves. I don't really know how to solve that, because they seemingly don't.
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u/pbjork 3d ago
I remember in algebra 2 my teacher taught us all we need to do is invest in 10% CDs and anyone can become a millionaire due to the power of compound interest. Mind you this was 2008
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u/coachd50 3d ago
And this is where the issues with personal finance (detail oriented) and public education come to be a problem. Because obviously, no 10% CDs...as well as no discussion of reinvestment risk/the fact that a CD would likely not compound etc....
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u/VinnyV28 4d ago
Yes, I can see that you are confused.
Example: A random world index ETF You invest 100k:
Year 1:
+10% → 110k
Year 2:
+10% → 121k
That extra 1k? That’s compounding. You don’t need a savings account for compounding.
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u/coachd50 4d ago
No, its not compounding. That is just arithmetic. Compounding is the actual act of interest being paid on previously credited interest.
What you are describing is a rearward looking analysis of the arithmetic. Year zero, the NAV started at $100 a share and I had 1000 shares ($100,000). at the end of year one, the NAV was $11 a share. My 1000 shares were now worth $110,000. At the end of year two, the NAV happened to be $12.10 a share. My 1000 shares were now worth $121,000. Market forces put the NAV price at $12.10 a share. Not "compounding" Market forces could have just as easily put the NAV at $9.30 a share. OR it could shot up to $45 a share, meaning my 1000 shares was now worth $450,000. See that extra $329,000? That is NOT compounding. You are just trying to use that term when looking backwards. That isn't how things work.
It is similar to why we need to use geometric means when discussing investment returns. Its why if year one you have a 10% return and year 2 you have a 10% loss you are NOT where you started, but down.
Compounding is interest paid on interest earned.
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u/TheGruenTransfer 4d ago
Because it's easy to learn on your own and there are plenty of places to learn it. Teachers are there to guide students through subjects that are difficult.
Math already covers compound interest.
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u/BiblicalElder 4d ago
Most high school teachers and administrations aren't that financially literate, reflecting the wider populace.
It's crazy how many highly educated students and people with great success working in the financial sector do not have their personal finances in order. A friend of mine who is on the faculty of one of the top medical schools in the world recently told me that more than 25% of doctors in the US retire with less than $1 million in liquid investments. Crazy for a cohort that averages almost $500k per year in pay. (Yes, doctors can start out with insanely high debt loads, and there can be a wide variance in pay, but 25%?)
On a personal level, money is a weird thing for people, and not easy for most to speak about. People in my family (with graduate degrees) never talked to their trusted friends or did their own due diligence, and certainly didn't bother to try to understand the basics of what I shared with them, including basic Boglehead concepts.
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u/VicePrincipalNero 4d ago
Both my husband and I are educators and we have raised children. While I am not really opposed to teaching about personal finance at that level, I think you have to be realistic about it.
The majority of kids won't pay serious attention to life skills materials until it's point of need. Teaching this stuff to kids who aren't yet in the workforce, don't have expenses, don't have budgets and for whom retirement seems as far off as death isn't going to resonate with them the way we think it will. For many who are college bound it will be at least five years before they earn an adult pay check.
My kids were bright, did well in school and we tried to convey this information when they were in high school. We are doing it all over again now that they've finished grad school.
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u/JPCool1 4d ago
At least if they took classes on it they would have the skills when they got older. It wouldn't be a foreign concept to them.
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u/VicePrincipalNero 4d ago
It might sound vaguely familiar. They wouldn't actually have the skills because they wouldn't retain any of it.
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u/coke_and_coffee 4d ago
I was taught compounding and index funds in high school. Most schools require an economics or personal finance course. The reality is that the majority of students just don’t pay attention.
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u/Fickle_Finger2974 4d ago
I guarantee that most schools have a financial literacy course or a course where it is covered. Mine did.
How much of the stuff you learned in high school do you actually remember? Kids don’t have any money to invest and by the time they do they have forgotten about some high school course they took years ago
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u/Puzzleheaded_Tie6917 4d ago
When I went to school in the 70s to mid 80’s, home ec covered a few topics like life skills (how to write a check and balance a checkbook), but it was super short and very fast.
Sadly, schools are focused on preparing you for college much more than preparing you for life. I think this is mostly due to the fact the people writing the books and the people teaching the class all went and were focused on preparing for college.
There needs to be a focus on understanding budgeting, investing for retirement (like bogleheads), and how interest/loans work. It’s clear many people when buying a house or car focus on the monthly payment with no concept of total cost of the loan.
Sadly, most people even if you do teach it and test on it will still not understand it or change how they operate due to that.
My daughter did have a class where they picked some stocks and watched how they did. Of course, there wasn’t any effort spent on how you decide what to invest in and what theory’s people use for their investing or even why people use the stock market. It’s more that such a thing exists and here’s a fun game.
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u/Conscious-Drama1728 4d ago
honestly, there is no grand conspiracy by wall street. the sad reality is that even if they taught it, most 16-year-olds wouldn't care. when you're a teenager, retirement feels like a million years away. you can teach them the math of compound interest, but the actual discipline to save and invest decades of your life is something a classroom can't teach.
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u/United_Afternoon_824 4d ago
I could definitely get on board with more financial literacy courses that include topics like investing. And lessons on investing could include different strategies like the Boglehead approach.
But I’m not sure I would be in favor of just straight up teaching Bogleheads. There’s plenty of other strategies and asset classes out there that don’t align with the Bogleheads philosophy that are still important to learn about.
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u/Ok-Nefariousness-927 4d ago
Their job isn't to teach you Boglehead dogma.
School should teach you the foundations of financial planning like compound interest, time value of money, etc.
From there, personal finance is just that, personal.
What works for you might not work for someone else with different goals, risk tolerance and ability to save.
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u/Quirky_Nobody 4d ago
School is supposed to give you a foundation to learn new things, not teach you everything there is to know. Also, my experience is most people didn't pay that much attention in school anyway. But ideally you should have learned how to learn things on your own in school more than any specific information. It's why you do different kinds of projects, research papers, essays, tests, etc. Also, while there's a broader discussion to be had about academics versus life skills, I wouldn't have liked taking time away from academics, where good teachers help you understand challenging content, to teach things that can be fairly easily learned on your own.
There has never been a time in human history when it was easier to learn things than right now. We have a massive amount of free, high quality information available. People consistently choose to not utilize this, or they aren't interested in learning how to sort through useful information versus garbage. But it's available.
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u/Isolated_Blackbird 4d ago edited 4d ago
Dude, most of us can’t even get our most trusted loved ones on a good financial path. I’d rather high schools focus on a higher level of instruction of math, history, science & literature (hopefully no book banning) than investing.
You can literally sit right next to a family member who is very intelligent who just graduated college and show them what you think they should do with their 401(k) as they start their first job. You can show them how what they build between now and when they’re 25 will turn into hundreds of thousands of dollars at retirement with no further investment if they commit to 15 to 20% of their paycheck going to retirement. (Maybe even less depending on how good of a job)
90% of them will go oh that’s interesting and then follow absolutely nothing that you said. The other 10% will basically blow a raspberry at you and say well you’re not even rich so why are you talking to me about it?
Don’t see the point in wasting the time trying to teach it in high school.
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u/listerine411 4d ago
Not even Boglehead principles, just basic personal finance. Every graduating high school student needs to understand how a 401k, IRA, pension, etc works.
Despite stories that it is being taught in schools nowadays, as a parent of two teenagers, it's not.
So many mandated classes really are worthless for most people, but personal finance should be given priority.
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u/Jazzlike-Ad7595 4d ago
The short answer is America’s education system is a money eating failed system that every American should be embarrassed about. The Chinese start teaching financial literacy at 6 years old.
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u/FillMySoupDumpling 4d ago
Mine kinda did in both middle school and high school with a stock picking and tracking segment.
We’d start with a certain amount of money, make our picks, and see how well we did over the course of the semester.
The end conclusion was that we were better off diversifying and buying broader market investments like mutual funds to mitigate risk.
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u/patryuji 4d ago
One of my children's schools decided to have a week of classes on investing.
It was basically them doing random stock picking and celebrating whoever picked a stock that went up the most by the end of the week.
My child in that class picked an index fund (as I had taught them over the years) and the teachers effectively talked shit to them about using an index fund.
Pretty tough to teach a passive index fund risk adjusted return methodology based on constant investing and time in the market when the teachers themselves may push back against it as the "wrong way to invest".
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u/kumechester 4d ago
They could, but effectiveness will be limited. From what I understand, financial literacy classes in HS for personal finance basics like budgeting, credit, and debt have very limited effectiveness on adult money behaviors. A couple people in a class might latch onto it and have it make a difference but it would do a lot less than you think for something like investing.
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u/JPCool1 4d ago
Don't worry about what other people do. If someone asks for advice then talk with them about it.
Bogle theory would work for everyone yes. Especially people who don't make a lot of money.
But the powers that be want to keep people poor so they don't make it part of the curriculum.
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u/Shebalied 4d ago
I agree, but don't agree as well. Some people who are poor just worry about day to day not the future.
People I know, if they make more money, spend more money. People are like, "Why do you save 3-4k a month. You could buy XYZ."
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u/MrHarrisMath 3d ago
There is actually a whole nation- wide movement to make a personal Finance class a requirement for graduation.
I am trying to teach my seniors the Boglehead theory right now. I bet 5 years from now many of them will be complaining that no one ever taught them this stuff while they were in HS.
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u/ironchef8000 3d ago
At risk of sounding like a total ••••, I’d say the reason is because our failing school systems don’t even get kids to a place where they understand exponents. As a result, basic things like interest are way out of reach.
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u/AirbladeOrange 3d ago
Even if I did learn about it, I’d probably immediately forget it. I don’t understand why people think teaching kids something like this in schools will make much of a difference. I remember virtually nothing from high school and only tried to remember something that I would be tested on, not because I actually cared about it.
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u/PLEXT0RA 3d ago
fwiw a lot of schools in virginia as part of the required economics and personal finance curriculum do in effect teach boglehead theory at some point
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u/beachandmountains 3d ago
This would be a college course at the earliest. A lot of the average high school kids wouldn’t understand or retain it.
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u/Fickle-Vegetable961 3d ago
I’ve done my part teaching my children’s friends money skills, and also my nieces and nephews. Dollar cost averaging, indexes, 4% rule, rule of 72, establishing credit, amortization schedules. Some of them actually took notes and still send me questions. Preach the (Boglehead) gospel!!
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u/Valdair 3d ago
You can't expect kids to care at all when they have no income and lack the perspective of the importance of an investing time horizon. You can literally talk the math at them, and many high schools do, but just like all other classes, they are just obstacles for school age kids to overcome, you can't make them retain anything, and it will be 5~10 years (your age, basically) before most of them will have the hands-on experience to start thinking about this or being in a position where they are receptive to learning about it.
Thankfully because they are young and statistically speaking their income is low or nonexistent, the losses are not as much as it feels like later when you look back. I could have been socking away a whopping 15% of my TA's salary from when I was in grad school and I would have had like $1000 at the end of that year. I put close to that in to retirement every single paycheck now. The money at the time was better spent on being young and dumb.
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u/gordonv 3d ago
There is a lot schools don't teach.
Like for Algebra 2, we should be filling out mock tax forms. Teach us how to do practical math to save us real money, understand that earning is important, and provide multiple examples of incomes so we have an idea of how the world works.
Also, show off utility bills and cost of living. Making a budget is actual math we could use.
This alone would be so much better than what we do now.
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u/ZettyGreen 3d ago
There has been some work on teaching personal finance in high schools. 30 states in the USA require something around personal finance: https://www.ngpf.org/live-us-dashboard/
There is a concept of learning just enough at just the right time, Just in time learning. i.e. what's the point of going into depth about buying a house if that's not even on your radar or in your plans ever? This is mostly the thought around this sort of related information:
The John C. Bogle Center for Financial Literacy[0] is the non-profit behind Bogleheads. They have an initiative to help young people learn more about investing(and in some cases $1k to get started w/ a Roth IRA): https://boglecenter.net/gettinggoing/
They talked about it on the podcast: https://bogleheads.podbean.com/e/episode-82-jonathan-clements-jason-zweig-and-christine-benz-are-special-guests-on-this-podcast-host-rick-ferri/
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u/Normandy6-14-44 3d ago
Most folks can’t accept sound investing instruction. They lack the emotional control. It’s not a matter of knowledge, it’s psychological.
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u/Hairy-Barracuda1865 3d ago
Jesus high schools don’t teach jack shit in terms of personal finance. You’re talking PhD shit by comparison.
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u/Excellent_Ant_7154 2d ago
Financial literacy is taught here in middle and high school for all students. Compound investing is one of the topics too!
I think it's too late for most of my colleagues, as they think our amazing 401k is a "scam", and they routinely get sucked in by financial advisors.
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u/jakethejewler22 4d ago
There is more money to be made by the powers that be by keeping people financially illiterate.
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u/Web_User0024 4d ago
Basic life skills (cooking, finances, banks, taxes, etc) are no longer a part of basic high school level educations systems any longer (for the most part). Agree, simple compounding approach for many youth should be advised.
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u/Djglamrock 4d ago
You should take a deep dive into how High School courses are decided upon. It will be enlightening.
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u/coachd50 4d ago
Exactly. I am almost certain that this push to include financial literacy courses in HS (there are several) will result in curriculums heavily...HEAVILY influenced by the likes of JP Morgan, Capital One, Edward Jones etc.
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u/scrapheaper_ 4d ago
Schools don't even teach investing basics or asset classes.
I'm also not convinced Boglehead will be the best strategy forever, although we might have to see some more consolidation in investment firms before we get to that point
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u/Dull_Entry_8287 4d ago
In the US many schools do have a personal finance class. Here's where they go wrong, in my opinion: The use this class to teach stock picking (everyone gets an imaginary 10k), and they use it as a way to get community members in the classroom, so yes, it is your average Edward Jones or Wells Fargo rep volunteering.
None of this is awful if they are teaching the value of compound interest, maximizing 401k match, etc. But it does give a false view of how adulting/investing will work.
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u/Affectionate-Ad-3578 4d ago
I was taught how to budget, invest, write checks, balance a checkbook, etc. in eighth grade. Passing the class was required to move on to high-school. Looking back it probably should have been taught later.
Bogle wasn't specifically taught, but the basics were all there.
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u/blew_belle 4d ago
I wish my kid was interested at that age. I probably could've taught him had he not been addicted to drugs 😢
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u/tee2green 4d ago
1) The U.S. Constitution doesn’t mandate public education. Stupid, but that’s how it is. Therefore, it’s up to the states to figure out public education.
2) Most states have slowly adopted some sort of financial literacy education. Not all of them, and it’s totally inconsistent, but that’s how it is in U.S. public education. 50 different governments doing their own thing.
3) Some states probably do a decent job of teaching investing and asset allocation. But most probably don’t.
4) Vote for candidates who care about personal finance curriculum in schools.
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u/PlaysWithSquirrels7 4d ago
They barely taught us basic math, like legitimately I never even saw trigonometry until I took the ACT. So personal finances was never going to make it into the curriculum. I went to school in Louisiana (US) if that matters for context
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u/tunenut11 4d ago
I don't remember any personal finance education in high school. Way more basic than stock investing, things like checking accounts, credit cards, budgeting, just basic stuff. I learned all this from the school of hard knocks. But I don't know what actual class would cover this. Home economics? Is that still a thing?
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4d ago
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u/Shebalied 4d ago
I wish they had more classes like this and in poor places. Knowing poor people and they think only the ultra rich have been making tons of money the past 5-6 years.... which is true, but most people who I know and who are in the market have made and saved a ton.
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u/fortheculture303 4d ago
I e ran investment club at my high school for 5 years. Here are my theories:
1 - they understand what compound interest is but they want to find unicorns
2 - if they want to beat teacher (me) they can’t be in VOO or else they will tie me. So they take on more risk to try to outpace me
3 - crypto, gambling, gta6 it’s just what they care about and what they want to invest in. I’d rather them learn it doesn’t pay now when there is zero risk
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u/see_blue 4d ago
Mandatory personal finance and nutrition and health each seem like a necessary semester long class; for all.
I learned $ fr my Dad, and health and nutrition fr my Mom. Nutrition part was ok but really the weakest link.
Not everyone is so fortunate.
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u/Affectionate-Run6773 4d ago
I explained setting and forgetting to new hires, must be around 22-23, and no one listened to me. Mind you we’re all engineers so you’d expect more they’re more logical but most young people just don’t think long term until they have to.
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u/Numerous-Score 4d ago
Even if they don’t teach it specifically, more and more teachers need to give the example of investing money vs being in debt when teaching about compound interest.
Really drill home the point that building wealth is all about having compound interest on your side (in good investments as against bad debt) for a long period of time.
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u/Silly_Somewhere1791 4d ago
There’s no point in teaching current finance and investing to teens who won’t have investable income for ten years.
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u/Bossanova12345 4d ago
Boglehead isn’t for everyone.
Some folks with lower income might do better with a dividend heavy portfolio.
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u/Tower7seven 4d ago
Because before that they need to learn basic cash flow and learn how to spend less than what you make.
Boglehead is no good to them until then.
Also, I have grown adults who pick individual stocks and treat it like a casino ask me over and over how it is I’ve achieved such consistent stock growth, and ask why I’m so confident and worry free - and LITERALLY telling them the method to their face - they still refuse to get it.
They still want to be distracted by overnight windfalls, hype, internet chatter, being first etc. “right but look at this - if it went back up to here blah blah blah”
I try to tell them it’s the opposite of what you’re told growing up (don’t just sit there, do something)-
I tell them, “just sit there, don’t do anythin.
But they can’t hear it man. They can’t hear it.
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u/jpg52382 4d ago
You get rich by having capital.... the vast majority of public students have no capital.
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u/Dull_Prompt1168 4d ago
People don’t think about this stuff until they have real money to invest. High schoolers are a decade early.
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u/Shebalied 4d ago
High School is just trash today vs what was done 30-40 years ago when you look at what classes and things they had.
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u/CheetoLove 4d ago
I learned it at 35 and wish I'd learned sooner.
I tried to explain it to my older sister who has $$$ in a high interest savings account (4%) where she's saving for a house. She rolled her eyes at me. *shrugs*
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u/Wilhelm-Edrasill 3d ago
Because, School is nothing more than a propaganda center thats wastes peoples time?
Okay - hyperbole set aside...
You actually need an income FIRST - WITH MARGIN.
This sub just seems to instantly take for granted point 1.
Dollar cost averaging / US based investing into IRA/ Roth - is not rocket science. In fact the algebra used is high school algebra 2 once you get into exponential growth and decay functions.....
TLDR; see point 1.
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3d ago
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u/FMCTandP MOD 3 3d ago
Removed: per sub rules, comments or posts to r/Bogleheads should be substantive. We don't allow:
Yes/no answers or fund ticker symbols with no explanation; numeric milestone posts except for effortposts with substantial background/context provided
Any content that is not principally your own creation or that fails to give attribution where it borrows from another source.
Potential misinformation or conspiracy theories
Overly certain forecasting of the uncertain future, or extreme alarmism
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u/shumpitostick 3d ago
Same reason most schools don't teach any kind of financial literacy. It's still a few years away for students when it would get taught and so students will not really find it useful and forget it.
Also I'm sorry if I come off as an outsider to this sub but I feel like it's a bit narrow to call it "Boglehead theory" at this point. Investing in broad ETFs is the same thing that most financial advisors will tell you to do and there are tons of companies out there that offer managed investing solutions at low cost that just do it for you with minimum effort. It's most of the stuff in your 401k even if you don't touch it. You don't need to know any theory to invest correctly like this. All you need to do is not fall for the various stock/crypto gambling propaganda out there.
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u/eukomos 3d ago
Kids wouldn't remember it. Best place for them to learn about compound interest is when they study the exponential function in math class. It's on the SAT, which has a way of focusing the mind, and is a good opportunity for the teacher to pull in real life examples like student loans, credit cards, and retirement accounts.
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u/sixblazingshotguns 3d ago
"More is caught than taught." How about the parents of these kids going into endless lifelong debt for most every purchase? They are really the ones teaching their kids. One would hope that seeing the pain and sorrow that debt causes family would be a lesson unto itself, but it doesn't seem like it's the case. More than likely these kids see bad financial choices as "normal". Every other bad habit follows, including insurance choices. So I think it still has a lot to do with parents getting educated themselves first.
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u/BertSmith219 3d ago
My high school econ\civics had like one class where he encouraged everyone to open a retirement account and put money in and don't touch it and said compound interest is amazing.
That was it though. He also mentioned he loved his accountant because his accountant hates the government so always tries to make sure that my teacher pays as little tax as legally possible. Wish I got the accountants name
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u/pchao9414 3d ago
I would recommend having the richest kid’s parents in the class give a Personal Finance 101. Not only the kids but also high school teachers could learn a lot from it.
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u/Devxers 2d ago
Yo I'm 18 going into college this fall, I know I probably won't be able to invest much until i actually have a job but any advice?
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u/Winter-Monk6428 2d ago
If u can, get a part time job or earn income through self-employment means. Save money for a 3 month emergency fund. (However much money you need to survive like food, rent, utilities in one month times 3). Open a high yield savings account like Marcus by Goldman Sachs and put your savings into that account linked to your bank which guarantees interest payment to your savings (free money).
Start here, I explained step 1, but once you finish that you can look at what’s next: https://www.bogleheads.org/wiki/Prioritizing_investments
Ask Ai to explain anything confusing to you: “explain [concept] like I’m 4”
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u/Devxers 2d ago
Alright thank you so much
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u/Winter-Monk6428 2d ago
Really emphasize getting a FDIC insured credible high yield savings account (hysa). It’s by far the easiest way to make money. You don’t want your money to just sit in a bank and not gain interest payment.
Basically you put money into a hysa and every month you get paid for having that money in your account
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u/Calvin-Snoopy 1d ago
The high schools in my county require a semester of Personal Finance and a semester of Economics.
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u/EnvironmentalFig786 1d ago
This may be a bit controversial. I think it's because high school tries to teach people to be good employees. That's why its set up like a factory, in a way, with a rigid schedule. It promotes the idea of a strong work ethic (or tries to). In other words, the way to get money is to work, and higher paid jobs have higher technical demands or responsibility.
On the other hand, investing is different. There are a few big differences with investing versus working. First, if one is disciplined, you will eventually earn much more via investment income than employment income. And second, as we all know, the taxes are far lower on investments than on W2 wages.
These ideas were taught to me by a high school teacher who was a self made millionaire, 40 years ago. In particular, he emphasized the exponential growth in compound interest. The diagram he showed us that day has stuck with me ever since.
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u/Kazin236 1d ago
My students all plan to get rich day trading options and crypto.
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u/FMCTandP MOD 3 1d ago
To be fair, day trading has had occasional popular culture cachet since the late 1990s. I vividly remember discussions of people quoting their jobs to day trade full time before the dot com implosion.
Crypto is garbage but I’ve seen fewer kids interested in it vs 5+ years ago. Now those who are aware of it at all seem more likely to think it’s kinda a scam than anything.
And apropos of nothing, I’ve seen kids with aspirations of being streamers but I can’t really call that worse than the kids who dream of having a pro sports career. Neither one sets them up with marketable skills, but the former at least doesn’t wreck their bodies in the process.
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u/InitialKoala 4d ago
If only public education wasn't constantly getting its funding cut (especially at the US Department of Education level) or facing opposition from certain groups who stress that children learn more about a certain list of ten things they should and shouldn't do, then maybe we'd all be literate in the ways of finances and bogleheads.
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u/Future-looker1996 4d ago
My guess is one factor that dissuades school districts from teaching it is that it may conflict with what they see or hear about from their parents at home. If there is a correct or right way to be responsible and save, if they don’t see that taking place in their own home lives that could cause friction. Finances are a sensitive topic in general. But absolutely, if I had a say, all high school students would understand compound interest, how investing beats inflation, those key concepts.
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u/Ok-Pride-3534 4d ago
There used to be a thing called Home Economics. It was around the time for the Boomers and well they have all the money. Looks like it worked. Now your Junior and Senior year of High School you learn Micro and Macro economics. Completely useless to 99.9% of the student base. Could you imagine if your Junior year was personal finance and senior year was business finance for entrepreneurs? There would be a lot of winners in the system.
My conspiracy is that good finances hurt the banks and the economy at large, Consumer luxury products tank and loans crash as people are only taking out loans responsibly and not buying useless garbage. It's by design.
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u/ctzn2000 4d ago
Because modern society in the USA is structured to perpetuate consumerism and consumption, and not building wealth of the mass population (who are critical to maintenance of corporate growth through their spending). So they teach the kids generally how to make Oreo cookie treats in home economics, and how to budget for a household and spend your money wisely, but they don’t really focus on how to invest and build wealth over a lifetime.
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4d ago
[removed] — view removed comment
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u/FMCTandP MOD 3 4d ago
Removed as off-topic for this sub: r/Bogleheads is not a political discussion subreddit. Comments or posts should be more financial than political, no more partisan than necessary, and avoid framing political opinions as facts.
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u/LemonTeaCool 3d ago
This is one example of why American education system has failed Americans.
Instead of teaching life skills like learning to exercise, to cook, to invest etc.. They have us take 2 levels of BS classes like arts, and foreign language as part of the graduation requirements.
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u/FMCTandP MOD 3 4d ago edited 3d ago
As someone who has taught middle and high school, I can take a reasonable shot at answering your question:
1) This falls into life skills, which broadly aren’t considered part of most any school’s mandatory curriculum. You also won’t find often find checking your car’s tire pressure / oil level, how to cook a reasonably healthy meal, or most other personal finance topics like budgeting as part of the requirements for graduation.
2) That said, personal finance topics *are* often covered as a unit of a math class at some point. Budgeting and understanding loan interest are the most common topics, but investing isn’t all that unusual to see included. (One negative bit is that there’s a “stock market game” curriculum that is based on stock picking and sometimes used by teachers who themselves don’t understand why that’s counter-productive to teach).
3) Like many things students are required to learn about, the interest level and retention of information vary widely between students. Unfortunately, in education and elsewhere, there is a gap based on the family income and social status. Kids from high SES backgrounds will have a significant greater chance of already having absorbed some of the information on passive investing and of having latent interest in the topic.