Learning Money

How elementary school financial education predicts entrepreneurial success.

“Hi Samson, I got your name from George. I need your help. I launched my startup last year and am running out of money. Can you help me raise $6M dollars for another 18 months of operations?” — Client

Jet lagged and hangry in Dubai in 2017 I was treating my insomnia by listening to random podcasts based in the UAE. For whatever reason in my discombobulated, lethargic state I landed on Dismissed with Jeremy Williams. Jeremy it turns out is my brother from another mother. Jeremy is a High School Principal in Abu Dhabi, who is originally from Gary, Indiana. Jeremy has this crazy idea of teaching financial literacy to kids. For me that was great, as I was in Dubai being a principal to bank and financial institution executives helping them understand and navigate blockchain, cryptocurrencies and the pace of financial technology innovations. Turns out a 13 year old and a 65 year old have pretty much the same questions about emerging technology, with the former “getting” what digital value and the future of data as money is much faster and with less resistance than the latter.

So, as all great modern day pen pals start I reached out to Jeremy in the twittersphere (@JWilliamsEDU) to learn more about his thesis of teaching financial literacy to kids. As a result, over the past two years we’ve had nearly daily Twitter chats and recoded a couple of podcasts discussing the future of education and wifi as a human right. These discussions slowly led to the epiphany that then led me to write this article. What is that epiphany? It’s actually something so obvious, its elusive to the majority of modern, primary school curriculum. Entrepreneurs and startups fail because they learn financial literacy, for the first time, six to nine months after betting their life savings and credit score to launch their business.

Budgeting 101

In America, you can graduate with a PhD in any degree (even accounting) and never once be required to take a financial literacy class. Granted, if financial literacy classes were required, it may discourage savvy students from assuming hundreds of thousands of dollars in debt for an education rendered obsolete due to AI automation. But the problem with financial literacy is that the majority of people pay the iron price of bankruptcy to learn even basic budgeting. The number one challenge my clients face (I’m a consultant for businesses who are having emergencies most of which are operational, cultural and financial) is that they have no budgetary education or training. Not complicated accounting or tax avoidance education or training, I’m talking about basic budgeting. I have or make this much money, here is what I can afford to do. Preferably written down in an excel spreadsheet or any of the thousands of budgeting and accounting programs available.

• How does a twenty-five year old student, with $80k in student loan debt and $30k in consumer debt, launch a startup without a personal and business budget plan?
• How does a 65 year old retiree fund a startup business without reviewing not the projected income (all startups are billion dollar companies in their pitch decks) but their operational budget for the first 24 months of operations?

Those really aren’t the most important questions. Yes, they’re troubling but the real question is, “Why does our educational system set up students to fail by not providing basic financial literacy from elementary school to college?”

Children who have basic financial literacy from an early age are more likely to be financially responsible adults. That’s not rocket science. It’s very similar to children who are taught nutrition and physical education are more likely to be healthy young adults. However, when it comes to financial literacy education for kids (what is money, how credit cards work, how to balance a checkbook, what is a loan, what APR means, how to make a grocery/food budget, etc…) we are failing them even more than we are in physical and health education. As a result, the United States is facing a childhood obesity epidemic and a young adult debt/financial crisis.

Addressing Financial Ignorance

How we can address financial literacy to improve the lives of students and entrepreneurs is pretty straight forward:

1. Create age appropriate financial literacy curriculums.
2. Begin teaching life skills to children beginning in primary school and continuing through college (.e.g: how to make a food budget) .
3. Make financial literacy courses core curriculum for graduating from high school.

Yes, there are nuances to be worked out in implementing these financial literacy strategies. However, when we look at “core” educational requirements to graduating from high school — history, math, science — why is there no core requirements for mastering life skills and financial literacy that each generation of students must face? Tax season is as reliable as Spring but we leave it to each generation to find out what a 1040 EZ form is and how mortgages work, after they’re swimming in an ocean of financial debt.

For more information on how financial education is evolving in primary and secondary schools in Abu Dhabi, Dubai and other global markets follow Jeremy Williams on LinkedIn and twitter at @JWilliamsEDU and listen to his podcast DisruptedTV presents Dismissed with Jeremy Williams. If your startup or business is in trouble and at risk of failing due to operational, organizational or budgetary I recommend hiring an old retiree to advise you. Why? When you’re on a fixed income, life has taught you financial literacy and budgeting the hard way.

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Thank you for reading my article. On LinkedIn and for the Blockchain Business Magazine I regularly write about technology, cannabis, crowdfunding, health and compliance investing trends. To read my future posts simply join my network here or click ‘Follow’. Also feel free to join me on Twitter, Facebook, Instagram, or YouTube.

About Samson Williams

Samson is an internationally recognized anthropologist and expert in operations, emerging technology, finance and organizational change management driven by FinTech innovation. Samson is ranked among the globe’s top innovative technology professionals for his cutting-edge research and applications in crowdfunding, tokenomics and digital securities. Samson is the co-creator of the University of New Hampshire School of Law’s Blockchain, Cryptocurrency & The Law Certification Program, adjunct professor at Columbia University in NYC, a Board Member of the Crowdfunding Professional Association, contributor at the Blockchain Business Magazine and Principal consultant at Axes and Eggs. For business inquiries Samson can be reached at samson@axesandeggs.com