Please Sir, May We Have some...More?

"Reality Rocks" ( see STAR article by Gina Covelli) is a spin-off of truly one of the coolest and most "real" learning that the Sun Prairie's school district offers to its students. Without a doubt, there is a vast array of excellent learning opportunities at SPHS. We single this one out because it is one of the very few opportunities kids get to learn the realities of life.

The upcoming "Reality Rocks" event for 200 seniors is kind of a "live fire" exercise of one project segment contained within the graduation requirement "Economics" course.

I first learned about the classroom project angle when our son took Economics as a senior 5 years ago. He came home with what he called, "the Marriage Project". As part of the project, he and another student partnered up and were "married". They had to choose "careers" and then research what those careers earned. They had to choose and "purchase" a home and obtain a mortgage. They had to start investing for retirement. They had to purchase a car. They had to decide on how many children they would have and what it would cost. I also recall that they had to build into their "dream world" a real life tragedy (I recall he and his "partner" dealt with the death of one of their children. All in all, this was --for me-- one of the highlights of his education at Sun Prairie.

Why was this a highlight? Because like many, I was raised by loving parents who opted to "shield us" from all the financial aspects of life. It took many years to "figure things out" (and I'm not too proud to admit that I still work at it). While I appreciate everything my parents ever did for me, I only wish I had been prepared for the realities of life: mortgages, interest rates, credit cards, investing, tax preparation

Real Life Example
True Story. Set the Wayback Machine to 1984. Our subject--let's call him Waldo--- exits college life and accepts a position with the University of Georgia Athens. Awesome! It pays $16,800/yr. Waldo thinks he's rich. In fact he's so rich, he almost immediately buys himself a brand new (no frills) Nissan PickemUp truck. Cost: $8,995 (seriously).

Dealer: "How much do you want to pay per month?"
Waldo: (thinking VERY quickly) "I can afford about $250/month"
Voila....a 48 month loan for exactly $248.06 per month
First mistake? Waldo paid the sticker price (Isn't that the cost? Nobody ever talked to him about "negotiating" the price).

Oh...the interest rate? Waldo never asked...but it turned out to be 14.5%. Waldo religiously made hi payments...but paid nearly 33% more for that truck. The interest alone cost him over $2900. But he was oblivious. And... oh those credit cards! They came in the mail daily! Waldo could buy whatever he wanted. If only he'd taken the time to read the fine print and see that the interest rates were generally about 20%.

A few years down the road, Waldo bought a house. Interest rate was a whopping 10.5%...he at least knew about that by then. What he didn't know was about this thing called property taxes. Imagine his chagrin when THAT bill came in December! Later Waldo moved to switch jobs and had to sell the house (and buy another). Hmmm...seems no one had ever mentioned that funny little thing called a real estate commission. Waldo just thought that was one awful nice lady who sold his house for him. Later, Waldo learned about re-financing.

The bottom line is that Waldo never learned anything related to money from his parents either. He recovered and managed fairly well, but probably would have fared much better with a little knowledge.

Please sir...can we have some more?
The only criticism I have...and it can't really be called a criticism...is that there is an incredible need to build upon what we do offer. Some suggestions (partly mine and partly those of my son from his 5 years post-high school vantage point).

• Could we separate out the "project" aspect from the Economics" class and make it a semester long course?
• Cover the details of managing a checking account--particularly in a debit card world and the spectre of identity theft.
• Cover the details of credit cards: the good, the bad, and the ugly.
• Have the students actually "file" taxes---even a very simple 1040 with a mortgage and investment income.
• Build in health insurance costs.
• Set up a computer simulation to track deposits and spending...basically squeeze a tax year into a semester.
• Make this course a graduation requirement.

In sum...the Reality Rocks event sounds like truly an awesome experience...but is living it for a day enough for these lessons to "sink in"? That's where the value of a semester long course---a graduation requirement--comes in. Expanding this would truly make Sun Prairie stand out from the rest.

Parents, in the meantime, please talk openly with your kids about the financial realities of life. If your child is one of the 200 starring in "Reality Rocks", then please have a great conversation with them afterwards about what they learned. They may actually make it through life without ever using geometry or trigonometry...but every last one of them will deal with (or suffer the consequences of) the financial aspects of life. Let them be prepared.

Rick Mealy for SP-EYE