Financial literacy is apart of literacy week at the library

Having grown up in a home where finances, both business and personal, were discussed at the dinner table (and everywhere else), it's often amazed my family and I how inadequate the education system is at preparing us in this particular regard.

What is money

If you were to ask 10 random people on the street, most would not be able to tell you what money is beyond telling you it's the cash in their pocket or in their back accounts. Money is fundamental to life, but we're never taught what it is, how it works and, most importantly, how we can make it work for ourselves. Money is far more than a medium of exchange - we exchange our time and energy for money our entire lives, so it probably makes sense to understand what it is that we're collecting in exchange for all that effort.

How do credit cards and debt work

There are clips online of interviews with students on college and university campuses where they're asked: how do credit cards work? The most astonishing answers involve explanations of how it's free money with no obligation of repayment. Banks and credit card issuers are in the business of making money; they lend because they expect to profit on doing so. The flip-side of that exchange means that, on average, those of us using credit cards are paying more than we should for our goods and services so that those banks can collect those profits.

Compound interest blew my mind

Here's a staggering figure: one of the richest men in the world, Warren Buffett, is famous for exclaiming that compound interest is the "eighth wonder of the world". The concept is pretty simple: you earn interest (or a return) on top of earlier returns. If you invest $10 one year and you have $11 the next, then the following year you'll have more than $12 as interest grows on your now $11 balance. If you've ever wondered how the super rich get to be, it's mostly because of simple things like this. As most are never exposed to these concepts, it's no wonder that most don't value how powerful saving, and investing, today can be for tomorrow.

Huge applause for the library taking on such an important subject and, moreover, targeting its event towards children. Kids who attend will be so grateful they did a few years from now.