March 24, 2017

It's not about numbers, it's about habits

MARCH 24, 2017

After my first, "Hey, can you sing two songs for $100?" gigs in University, my accompanist and I headed straight to the bank to cash our HUUUUUUUGE paycheques. At the ATM I heard him whispering to himself, 


Sitting at earls, eating away a RIDICULOUS portion of our riches, I asked him what he was whispering at the bank machine.

"Oh, that. 10%. My dad always has me put 10% of anything I earn intosavings account. It's just a habit. Don't you?

I think we all know the answer to that question. No, I was not in the habit of saving 10% of everything I earned. Clearly, he didn't know how much the beautiful shoes I was wearing for the gig had cost. I needed that entire $100. If I put 10% away, I would have less to use....

Oh man, what a slippery slope. I believed that lie. I really did. It never occurred to me that that saving was not a method of deprivation, it was a way to provide comfort and security for the future...especially not while I was sitting at earls eating a $14 hamburger and fries. And that was the 90s, people!

In a recent article, Ontario launched its plan to teach High School kids Financial Skills. 


Applause for waking up to the obvious, gang. I think they're on the right track, of course, if only because the education system finally realized that if kids are going to grow up and make money, they should know how to use it.

My beef? They're introducing it in MATH CLASS.

While yes, financial skills involve numbers, duh, the bigger issue that I see with my adult clients, now wanting to buy a home, is HABITS. Their spending and saving habits which reveal, glaringly, what makes them comfortable and secure. And that, my friends, is a SOCIAL SKILL

On a weekly basis, I have at least one of my teenage music students go into a meltdown over an upcoming math test (during their singing lesson). They're preaching to the choir, of course. I understand where they're coming from. Math isn't their strong suit (male or female), and they are convinced that they are terrible at math. 

My concern is that these bright kids, who associate 
will also associate 
with how well they do in math class. 
Full. Circle. Moment.

If you teach these saving and spending skills in tangible ways that incorporate the social consequences of their actions, I think you're going to get a much more balanced generation of savers. That way, the kids who are great in English, History, Music, and Drama class don't assume that, because saving skills are taught only in math class, they'll be a failure before they start. 

Seriously, the way kids spend money is almost ENTIRELY SOCIAL, or it was for me. Nice shoes. Eating out. Fancy gadgets. Down Jackets for goodness' sake! (As a Winnipeger, that last one is hysterically funny. Being warm is "cool"...bah ha ha ha ha!) And the list goes on.

THESE are the habits that turn them into over spenders in their adult lives: Keeping up with their friends' appearances because no one will ever see their beautiful savings account. 

And, not to put too fine a point on it, but GIRLS need to learn the habit of saving MORE than BOYS. Yep. If women continue to make less than men and also live increasingly longer lives, in this economy, they will remain vulnerable for generations to come.

Not to mention the fact that often (and I have seen this now a handful of times while preparing mortgages for my hard working clients) the income statements of the female in a couple is always LESS for 2 years at a time when there is a new baby in the family. The catch 22? THAT'S when we need to prove the most income, OR MORE SAVINGS FOR THE DOWN PAYMENT, to allow this growing family (who now needs more space) to qualify for a mortgage. 

(*aside: I mention the topic of women having children and what it does to their provable income on paper NOT to blame, but solely to empower these same women and families to be prepared for ALL future financial decisions, children or not. Knowledge is power. We're good? Good.)

So, great, Ontario, you're teaching finances in the schools. Just don't fuck it up like Ottawa did by not discussing mortgage changes with, you know, the MORTGAGE INDUSTRY (???)....during a HOUSING CRISIS (!!!)....Ok. I'll stop now.

Thanks for reading and sharing!