volunteering to teach financial literacy basics

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happyisland
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volunteering to teach financial literacy basics

Post by happyisland » Sun Apr 14, 2019 7:02 pm

My question is: for those of you out there who have done volunteer work with financial coaching or teaching financial literacy, what has the experience been like? Did you feel like you were able to make a difference in people's lives?

I live in a community where the level of financial literacy is not very high. So while I'm not any kind of financial wiz (see my post history if you need proof :shock: ) I feel like I could help people with learning the basics of concepts like budgeting, how interest works, how to evaluate large purchases, etc.

Good idea? Bad idea?

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FiveK
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Re: volunteering to teach financial literacy basics

Post by FiveK » Mon Apr 15, 2019 1:38 am

Finding an appropriate audience may be an issue.

Ideally you would have people interested in learning enough, and with the capability, to DIY - but who haven't done so already.

In most (all?) states one needs to be licensed in order to give financial advice for pay. Presumably you aren't doing this for pay and would be providing only generic advice (e.g., "consider index funds" instead of "invest X% in _____ and Y% in _____"), correct?

Swimmer
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Re: volunteering to teach financial literacy basics

Post by Swimmer » Mon Apr 15, 2019 5:17 am

My BIL did this as a volunteer for a “Money Management” program for the county. It was very basic and intended to help a low income population, well, manage their income/expenses. Despite his good intentions, it was difficult. Sometimes one member of a couple really wanted to make changes and the other refused. The majority refused to eliminate or downgrade expensive items like iPhones, cable tv, tobacco, alcohol, etc. Ultimately, the program failed despite an excellent group of volunteers who really wanted to help people learn to manage what little they have.

I hope your experience is better than his was. I applaud you for wanting to make a difference. Please come back and let us know how it goes.

aristotelian
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Re: volunteering to teach financial literacy basics

Post by aristotelian » Mon Apr 15, 2019 6:29 am

I would be worried about liability issues unless you work for an organization that carries its own insurance.

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happyisland
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Re: volunteering to teach financial literacy basics

Post by happyisland » Mon Apr 15, 2019 6:38 am

Agreed about finding the audience. I come into contact with a lot of people who are financial illiterate, but I'm not sure many of them are even aware that there is a better way of doing things. I'm starting to get my hopes up a tad since there seems to be a local organization that is starting up that I might be able to do volunteer work for. We'll see.

FiveK wrote:
Mon Apr 15, 2019 1:38 am
Finding an appropriate audience may be an issue.

Ideally you would have people interested in learning enough, and with the capability, to DIY - but who haven't done so already.

In most (all?) states one needs to be licensed in order to give financial advice for pay. Presumably you aren't doing this for pay and would be providing only generic advice (e.g., "consider index funds" instead of "invest X% in _____ and Y% in _____"), correct?

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Summit111
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Re: volunteering to teach financial literacy basics

Post by Summit111 » Mon Apr 15, 2019 6:41 am

Financial illiteracy in the majority of the population astounds me. I stopped giving advice to friends and family and simply refer them to the Bogleheads site.

Even with folks who use “Financial Advisers”, they generally don’t have a good handle on what they own and why....AND what fees they are paying.

My advice is given to my adult kids and spouse only....

Summit

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happyisland
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Re: volunteering to teach financial literacy basics

Post by happyisland » Mon Apr 15, 2019 6:49 am

This is the kind of experience I was hoping to hear about. Having failed at minor attempts (like trying to convince an acquaintance with an unreliable car that was making her late to work to spend her money on fixing her car rather than getting a huge expensive tattoo) I am dubious that I'll be able to make a difference.

I do have hope that there might be a cohort of indebted people who are open-minded and need help finding a path out of debt.


Swimmer wrote:
Mon Apr 15, 2019 5:17 am
My BIL did this as a volunteer for a “Money Management” program for the county. It was very basic and intended to help a low income population, well, manage their income/expenses. Despite his good intentions, it was difficult. Sometimes one member of a couple really wanted to make changes and the other refused. The majority refused to eliminate or downgrade expensive items like iPhones, cable tv, tobacco, alcohol, etc. Ultimately, the program failed despite an excellent group of volunteers who really wanted to help people learn to manage what little they have.

I hope your experience is better than his was. I applaud you for wanting to make a difference. Please come back and let us know how it goes.

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happyisland
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Re: volunteering to teach financial literacy basics

Post by happyisland » Mon Apr 15, 2019 6:56 am

The type of people I'm talking about helping are poorly educated (high school dropouts with shaky math and writing skills) who are particularly prone to getting the short end of the stick from sophisticated lenders (car dealers, appliance stores, banks, etc) and making ill-informed financial decisions.
I'm not talking about trying to help people plan for retirement (I have been very unsuccessful at this too... :oops: ). This would be triage - stopping the bleeding, stabilizing the patient, and moving them on.

Summit111 wrote:
Mon Apr 15, 2019 6:41 am
Financial illiteracy in the majority of the population astounds me. I stopped giving advice to friends and family and simply refer them to the Bogleheads site.

Even with folks who use “Financial Advisers”, they generally don’t have a good handle on what they own and why....AND what fees they are paying.

My advice is given to my adult kids and spouse only....

Summit

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Re: volunteering to teach financial literacy basics

Post by Grt2bOutdoors » Mon Apr 15, 2019 7:04 am

You might find that there is a huge distrust of banks. A common refrain I heard was “banks are out to steal your money”. Some folks refuse to take personal responsibility for their behavior.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

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TexasPE
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Re: volunteering to teach financial literacy basics

Post by TexasPE » Mon Apr 15, 2019 7:14 am

This is something I have been considering since my retirement (Jan 2019). Wife and I took Dave Ramsey's 'Financial Peace University' (FPU) many years ago - nothing new for me but helpful for my wife. I've since led ['coordinated'] two sessions at my place of employment (after hours, company purchased DVDs and workbooks). Audience was ~24 people per 10-week session, generally husband and wife, but sometimes employee and widowed parent. Content is outlined here

https://www.daveramsey.com/

Demographics: attendees were middle class ($60-160K) annually, hourly/ salaried, ~50% college degrees. We had some successes - understand fundamentals (need vs. want, it's not just 'can we afford the payment;, etc.). The course does an excellent job on these - the DVDs are fun and motivational. Don't agree with Ramsey's investment advice, but attendees have to get out of debt first, before having anything to invest. :happy

I think my post-retirement target audience will be ESL (English as a Second Language) students through the local Adult Literacy program. Many of these people are motivated college graduates from other countries who want to improve their English. Not sure whether to use FPU or another program. Plan to meet with the program director soon to discuss.
At 20: I cared what everyone thought about me | At 40: I didn't give a damn what anyone thought of me | Now that I'm 60: I realize that no one was really thinking about me at all | Winston Churchill

stan1
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Re: volunteering to teach financial literacy basics

Post by stan1 » Mon Apr 15, 2019 7:17 am

Grt2bOutdoors wrote:
Mon Apr 15, 2019 7:04 am
You might find that there is a huge distrust of banks. A common refrain I heard was “banks are out to steal your money”. Some folks refuse to take personal responsibility for their behavior.
There are a group of people whose experience with banks is monthly maintenance fees, over draft fees, high credit card interest rates, auto repo, and maybe even a pre-2007 zero down interest only mortgage with falsified loan applications? So you can understand why there is distrust of banks? Working with people is hard and successes might be measured in small steps.

Ybsybs
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Re: volunteering to teach financial literacy basics

Post by Ybsybs » Mon Apr 15, 2019 7:29 am

stan1 wrote:
Mon Apr 15, 2019 7:17 am
Grt2bOutdoors wrote:
Mon Apr 15, 2019 7:04 am
You might find that there is a huge distrust of banks. A common refrain I heard was “banks are out to steal your money”. Some folks refuse to take personal responsibility for their behavior.
There are a group of people whose experience with banks is monthly maintenance fees, over draft fees, high credit card interest rates, auto repo, and maybe even a pre-2007 zero down interest only mortgage with falsified loan applications? So you can understand why there is distrust of banks? Working with people is hard and successes might be measured in small steps.
Concur. Some also include entities like Payday Loans / Advance America / Check N Go and so on among the corporations thought of as banks. Some mistrust is appropriate.

Katietsu
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Re: volunteering to teach financial literacy basics

Post by Katietsu » Mon Apr 15, 2019 8:37 am

happyisland wrote:
Mon Apr 15, 2019 6:56 am
The type of people I'm talking about helping are poorly educated (high school dropouts with shaky math and writing skills) who are particularly prone to getting the short end of the stick from sophisticated lenders (car dealers, appliance stores, banks, etc) and making ill-informed financial decisions.
I'm not talking about trying to help people plan for retirement (I have been very unsuccessful at this too... :oops: ). This would be triage - stopping the bleeding, stabilizing the patient, and moving them on.
My advice would be to pick your battles and to focus on the better alternatives. Make sure you do not sound like you are on a soapbox looking down on them. Remember the behavioral part of finances. For instance, giving the government an interest free loan in the form of extra withholding doesn’t sound good to me. But if this is the only way a person will have the money to pay their spring property taxes or have a down payment for a reasonable used car, then it is a good choice.

Tdubs
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Re: volunteering to teach financial literacy basics

Post by Tdubs » Mon Apr 15, 2019 8:45 am

aristotelian wrote:
Mon Apr 15, 2019 6:29 am
I would be worried about liability issues unless you work for an organization that carries its own insurance.
I'd be interested to know the answer to this. Anytime anyone wants to do good (I can think of lots of examples), "liability" is often tossed out to stop the effort cold.

If you make it clear that you are no expert and form a DIY group or give a free presentation at the local library, has anyone ever been successfully sued?

TN_Boy
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Re: volunteering to teach financial literacy basics

Post by TN_Boy » Mon Apr 15, 2019 8:55 am

Katietsu wrote:
Mon Apr 15, 2019 8:37 am
happyisland wrote:
Mon Apr 15, 2019 6:56 am
The type of people I'm talking about helping are poorly educated (high school dropouts with shaky math and writing skills) who are particularly prone to getting the short end of the stick from sophisticated lenders (car dealers, appliance stores, banks, etc) and making ill-informed financial decisions.
I'm not talking about trying to help people plan for retirement (I have been very unsuccessful at this too... :oops: ). This would be triage - stopping the bleeding, stabilizing the patient, and moving them on.
My advice would be to pick your battles and to focus on the better alternatives. Make sure you do not sound like you are on a soapbox looking down on them. Remember the behavioral part of finances. For instance, giving the government an interest free loan in the form of extra withholding doesn’t sound good to me. But if this is the only way a person will have the money to pay their spring property taxes or have a down payment for a reasonable used car, then it is a good choice.
From volunteer work I've with low income people, aside from Katietsu's observation about having the right attitude, I think you'd need direct coaching/advice from people with experience in this area (what I would call, more or less, social work focused on financial matters).

I really don't know where I would start in many situations. Many of these people don't even have bank accounts. And tax refunds ... yes, they do want refunds. But given that many are living more or less on the financial edge, almost any tax due can become a burden (I do tax volunteering). And their budgeting is paying the bills when they come in if there is money. If not, the bill is late. And without a bank account, paying bills involves driving to the utility company and paying in cash ... a major time sink.

Anyway a fine idea, but you are going to need some help to do anything useful.

An easier task is working with lower to middle income people who have okay to decent jobs but just can't handle money (a lot of ideas and suggestions tend to target this group). Which are you thinking about?

SRenaeP
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Re: volunteering to teach financial literacy basics

Post by SRenaeP » Mon Apr 15, 2019 8:57 am

Swimmer wrote:
Mon Apr 15, 2019 5:17 am
My BIL did this as a volunteer for a “Money Management” program for the county. It was very basic and intended to help a low income population, well, manage their income/expenses. Despite his good intentions, it was difficult. Sometimes one member of a couple really wanted to make changes and the other refused. The majority refused to eliminate or downgrade expensive items like iPhones, cable tv, tobacco, alcohol, etc. Ultimately, the program failed despite an excellent group of volunteers who really wanted to help people learn to manage what little they have.

I hope your experience is better than his was. I applaud you for wanting to make a difference. Please come back and let us know how it goes.
I had a similar experience volunteering with a similar program several years ago. It really soured me on volunteering and I didn't return after the first series of courses (it was either a 6 or 8 week series that I did). While I don't doubt the attendees truly needed help, I was frustrated by their apathy and resistance. That role would be better served by someone with much more patience than I.

That said, this year I did volunteer tax prep through VITA. I've been contemplating some type of handouts that could be provided to people promoting basic financial/tax literacy.

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Re: volunteering to teach financial literacy basics

Post by deltaneutral83 » Mon Apr 15, 2019 8:59 am

Katietsu wrote:
Mon Apr 15, 2019 8:37 am
happyisland wrote:
Mon Apr 15, 2019 6:56 am
The type of people I'm talking about helping are poorly educated (high school dropouts with shaky math and writing skills) who are particularly prone to getting the short end of the stick from sophisticated lenders (car dealers, appliance stores, banks, etc) and making ill-informed financial decisions.
I'm not talking about trying to help people plan for retirement (I have been very unsuccessful at this too... :oops: ). This would be triage - stopping the bleeding, stabilizing the patient, and moving them on.
My advice would be to pick your battles and to focus on the better alternatives. Make sure you do not sound like you are on a soapbox looking down on them. Remember the behavioral part of finances. For instance, giving the government an interest free loan in the form of extra withholding doesn’t sound good to me. But if this is the only way a person will have the money to pay their spring property taxes or have a down payment for a reasonable used car, then it is a good choice.
Ramsey's class would work wonders for 80% of the population. There's really no need other than that to start with. Once you get into investing which 60% of the population never will, then it starts to become more prudent to find your way to BH's.

Tdubs
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Re: volunteering to teach financial literacy basics

Post by Tdubs » Mon Apr 15, 2019 8:59 am

Also curious to know, has any non-profit put out some sort of classroom package of curriculum materials on the topics mentioned above for budgeting, spending, and investment, freely available?

Katietsu
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Re: volunteering to teach financial literacy basics

Post by Katietsu » Mon Apr 15, 2019 9:08 am

Tdubs wrote:
Mon Apr 15, 2019 8:59 am
Also curious to know, has any non-profit put out some sort of classroom package of curriculum materials on the topics mentioned above for budgeting, spending, and investment, freely available?
Yes, these programs exist. For instance, at one point, the United Way in my area joined with a local bank to try to do a financial literacy program aimed at those who were lower income but above poverty level. There are some great basic education materials on one of the government websites, I am blanking on the location just now.

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Re: volunteering to teach financial literacy basics

Post by Grt2bOutdoors » Mon Apr 15, 2019 9:29 am

stan1 wrote:
Mon Apr 15, 2019 7:17 am
Grt2bOutdoors wrote:
Mon Apr 15, 2019 7:04 am
You might find that there is a huge distrust of banks. A common refrain I heard was “banks are out to steal your money”. Some folks refuse to take personal responsibility for their behavior.
There are a group of people whose experience with banks is monthly maintenance fees, over draft fees, high credit card interest rates, auto repo, and maybe even a pre-2007 zero down interest only mortgage with falsified loan applications? So you can understand why there is distrust of banks? Working with people is hard and successes might be measured in small steps.
No - I taught financial literacy to grammar/intermdiate/high school age kids, there is an astounding amount of distrust amongst the young of financial institutions. I spend a good chunk of my time informing them about what a bank is and what it is not. You'd be shocked how many people do not know what FDIC is. And going back to your statement above "a pre-2007 zero down interest only mortgage with falsified loan application" - who signed at the bottom of the document which says "I attest all of the submitted information is accurate and true"? Who signed the promissory note on the mortgage that says at closing "I promise to pay X amount per month for a period of XXX months, if said payment is not made on a timely basis, a late fee will be charged, if the mortgage goes into arrears, then said property will be forfeited back to the lender"? Hmm......?
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Grt2bOutdoors
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Re: volunteering to teach financial literacy basics

Post by Grt2bOutdoors » Mon Apr 15, 2019 9:31 am

Tdubs wrote:
Mon Apr 15, 2019 8:59 am
Also curious to know, has any non-profit put out some sort of classroom package of curriculum materials on the topics mentioned above for budgeting, spending, and investment, freely available?
FDIC.gov.....they have a robust classroom curriculum on personal finance/budgeting.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

markcoop
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Re: volunteering to teach financial literacy basics

Post by markcoop » Mon Apr 15, 2019 9:31 am

I would be very concerned about giving generic advice because the world is just not that clear as to right and wrong. A popular phrase on this sight is "there are many roads to Dublin". I think in the Boglehead scope, they are deciding between adding a small value fund or just owning a total market fund. However, once you branch out of the Bogleheads, I think there are many decisions where the answers are clear to people here but really "it depends" for them. For example, I am not a fan of whole life insurance for a few reasons - High fees, barriers to exit, unscrupulous salespeople, complicated products. I certainly don't believe that all such policies are bad. Who am I to give any kind of generic advice other than "be really careful". Another example may be with debt. I certainly don't believe in carrying any debt other than very low interest loans. However, for some it may be a quality of life decision. Maybe they believe they will be able to pay off the debt sooner rather than later.

Having said that, I am certainly not shy to giving advice. Many co-workers have come to me to ask my opinion. I am very very careful in what I tell them. I know they just want the answer (what they should do), but I am much more into trying to educate through showing the alternatives and letting them decide.
Mark

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Re: volunteering to teach financial literacy basics

Post by Grt2bOutdoors » Mon Apr 15, 2019 9:33 am

Ybsybs wrote:
Mon Apr 15, 2019 7:29 am
stan1 wrote:
Mon Apr 15, 2019 7:17 am
Grt2bOutdoors wrote:
Mon Apr 15, 2019 7:04 am
You might find that there is a huge distrust of banks. A common refrain I heard was “banks are out to steal your money”. Some folks refuse to take personal responsibility for their behavior.
There are a group of people whose experience with banks is monthly maintenance fees, over draft fees, high credit card interest rates, auto repo, and maybe even a pre-2007 zero down interest only mortgage with falsified loan applications? So you can understand why there is distrust of banks? Working with people is hard and successes might be measured in small steps.
Concur. Some also include entities like Payday Loans / Advance America / Check N Go and so on among the corporations thought of as banks. Some mistrust is appropriate.
Those are not examples of banks, they are examples of subprime financial predators.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Ybsybs
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Re: volunteering to teach financial literacy basics

Post by Ybsybs » Mon Apr 15, 2019 9:36 am

Grt2bOutdoors wrote:
Mon Apr 15, 2019 9:33 am
Ybsybs wrote:
Mon Apr 15, 2019 7:29 am
stan1 wrote:
Mon Apr 15, 2019 7:17 am
Grt2bOutdoors wrote:
Mon Apr 15, 2019 7:04 am
You might find that there is a huge distrust of banks. A common refrain I heard was “banks are out to steal your money”. Some folks refuse to take personal responsibility for their behavior.
There are a group of people whose experience with banks is monthly maintenance fees, over draft fees, high credit card interest rates, auto repo, and maybe even a pre-2007 zero down interest only mortgage with falsified loan applications? So you can understand why there is distrust of banks? Working with people is hard and successes might be measured in small steps.
Concur. Some also include entities like Payday Loans / Advance America / Check N Go and so on among the corporations thought of as banks. Some mistrust is appropriate.
Those are not examples of banks, they are examples of subprime financial predators.
Exactly so. But they are the financial companies that reach out to poor Americans and so some think of them as 'banks' even though they are not.

Grt2bOutdoors
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Re: volunteering to teach financial literacy basics

Post by Grt2bOutdoors » Mon Apr 15, 2019 9:55 am

Ybsybs wrote:
Mon Apr 15, 2019 9:36 am
Grt2bOutdoors wrote:
Mon Apr 15, 2019 9:33 am
Ybsybs wrote:
Mon Apr 15, 2019 7:29 am
stan1 wrote:
Mon Apr 15, 2019 7:17 am
Grt2bOutdoors wrote:
Mon Apr 15, 2019 7:04 am
You might find that there is a huge distrust of banks. A common refrain I heard was “banks are out to steal your money”. Some folks refuse to take personal responsibility for their behavior.
There are a group of people whose experience with banks is monthly maintenance fees, over draft fees, high credit card interest rates, auto repo, and maybe even a pre-2007 zero down interest only mortgage with falsified loan applications? So you can understand why there is distrust of banks? Working with people is hard and successes might be measured in small steps.
Concur. Some also include entities like Payday Loans / Advance America / Check N Go and so on among the corporations thought of as banks. Some mistrust is appropriate.
Those are not examples of banks, they are examples of subprime financial predators.
Exactly so. But they are the financial companies that reach out to poor Americans and so some think of them as 'banks' even though they are not.
Yes, they are known as non-bank financials. There are some that are publicly traded like First Cash Financial.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

TN_Boy
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Re: volunteering to teach financial literacy basics

Post by TN_Boy » Mon Apr 15, 2019 10:01 am

Ybsybs wrote:
Mon Apr 15, 2019 9:36 am
Grt2bOutdoors wrote:
Mon Apr 15, 2019 9:33 am
Ybsybs wrote:
Mon Apr 15, 2019 7:29 am
stan1 wrote:
Mon Apr 15, 2019 7:17 am
Grt2bOutdoors wrote:
Mon Apr 15, 2019 7:04 am
You might find that there is a huge distrust of banks. A common refrain I heard was “banks are out to steal your money”. Some folks refuse to take personal responsibility for their behavior.
There are a group of people whose experience with banks is monthly maintenance fees, over draft fees, high credit card interest rates, auto repo, and maybe even a pre-2007 zero down interest only mortgage with falsified loan applications? So you can understand why there is distrust of banks? Working with people is hard and successes might be measured in small steps.
Concur. Some also include entities like Payday Loans / Advance America / Check N Go and so on among the corporations thought of as banks. Some mistrust is appropriate.
Those are not examples of banks, they are examples of subprime financial predators.
Exactly so. But they are the financial companies that reach out to poor Americans and so some think of them as 'banks' even though they are not.
It is not just entities like PayDay Loans that can cause issues for people who are not financially literate. One taxpayer I assisted had a large capital gains distribution in an investment account that had been opened for her at her bank. The bank was reputable (it wasn't even Wells Fargo!). Almost surely the distribution was from an actively managed tax-inefficient fund. Having to pay taxes on these capital gains distributions was more than an annoyance for this person. (Taxable income without W-2 withholding trips up a lot of these people). In fact, I've seen multiple ways that even modestly sized investment accounts can cause people for trouble who do not understand the (sometimes "obvious" sometimes more subtle) nuances of managing those accounts. The banks aren't going to give tax advice .... Which is a long way of saying that telling people to open IRAs might lead to problems down the road for them that would surprise you.

It is really a different world for many people than the posters here. I'll just repeat my question above -- what exactly is the target audience the OP has in mind.

Rob1
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Re: volunteering to teach financial literacy basics

Post by Rob1 » Mon Apr 15, 2019 10:08 am

If you are interested in teaching financial literacy to K-12 graders, you may want to look into Junior Achievement:

https://www.juniorachievement.org/web/ja-usa/home

Knglou
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Re: volunteering to teach financial literacy basics

Post by Knglou » Mon Apr 15, 2019 10:09 am

I would agree with the Dave Ramsey course FPU it is a great way to teach people financial basics. You also have a mostly willing audience.
My wife and I have taught the older course 3 times (they updated the fpu course this year) we love to help people get out of debt and started
to build a financial future. It helped us out 7 years ago and we just wanted to help others. I know many here don't agree with his investing advice,
but it got me here eventually.

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