Jerremy Alexander Newsome is one of the world’s leading thinkers in stock market education and is the CEO of Trade in real life†
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About three million high school students in Florida are indebted to the Florida legislature. Why? Because when the Sunshine State was over… SB 1054 on March 8, 2022, it ensured that those students would receive an education in financial literacy, a subject that is not only life-changing, but also world-changing.
It is my hope that the lessons these students now have to take will not be a one-off, but will serve as a launching pad for a lifelong pursuit of financial empowerment. Financial literacy should not stop after high school. Wherever our lives take us, improving our understanding of finance is the key to living without financial pressures. Whatever our circumstances, we are never done learning about money.
From financial literacy to financial empowerment
Let me take you to another class we all had in high school: physical education. Most of us had to do a few pushups — or maybe more than a few — during gym. Some of us have continued to do pushups after high school, doing a certain number each day to build muscle and stay in shape.
Here’s the thing about pushups. In the beginning, they do a great job of growing our triceps, pecs and shoulders. But if we keep doing the same pushups over and over, we’ll eventually plateau† At that point, we either have to start adding some variety to our pushups or stop growing. The same goes for financial literacy.
The basics of financial literacy — balancing a budget, saving for a rainy day, and avoiding high interest rates — only get us this far. At some point we have to explore variations on the basics if we want our finances to grow. We need to analyze and study the science behind it. We need to move from financial literacy to financial empowerment.
Learning the art of investing
When I was 12, I asked my father what to do with my life. He said, “Study fees.” I went to college and got a finance degree, but nowhere in finance did we study real money. We studied numbers and figures on charts. We have studied accounting and accounting principles. We have studied debits and credits. We learned how to work with money, but not how to make money work for you. We haven’t learned the art of investing.
Publishing is easy to do. In fact, spending is so easy that we often spend more money than we have. Because it’s so easy, we have to work hard to avoid overdoing it. Expenses will not grow our financial muscles; want to invest. Going beyond the basics of financial literacy means moving from spending to investing.
If you think you need a lot of money to become an investor, I’m pleased to inform you that you: wrong, and you’re selling yourself short. Let me give you two lessons that should be part of Investing 101. Even if you don’t need these tips, your employees probably do.
First, investing isn’t about the amount; it’s about the art. And as with any art form, the more you practice, the better you get at it. Investing your $1 may not make you a millionaire, but you will get into the habit of investing. It will encourage you to buy assets, rather than spend on liabilities, and will further your financial education.
Second, you don’t have to be good at math to be good with money. A solid understanding of third grade math is all you need. If you can add, subtract, multiply, and divide, an Excel spreadsheet will do the rest. Getting an “A” in college-level math won’t hurt, but it’s not necessary to continue your finance education.
Leading others to financial freedom
If you are a leader in the business world, don’t miss the opportunity to help the people in your organization continue their education in financial literacy. Create a work environment where financial matters can be discussed openly. Give your employees a place and time to talk about money and investing. Try organizing a ‘Finance Friday’ once a month where the company buys lunch and people get inspired about experiencing financial freedom.
As I said before, we are all good at spending money. Most of us are also good at worry about money. But we will never get better at growing our money until we commit ourselves to learning how to grow it. Until financial literacy becomes more common and more openly talked about, financial empowerment will remain elusive.
I suspect most of you reading this are too old to take advantage of the financial literacy programs now being held in high schools. If so, find another finance teacher and keep learning. You will never outgrow your financial literacy.
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