By Osy Agbo
Growing up , I was lucky to have parents who harped on the time tested wisdom of debt-free living and saving for tomorrow.
Though back then, many of my friends considered us a little privileged, it was clear to me that was because none of our neighbors made the coveted Forbes’s billionaire list.
I was under no illusion of coming of age to inherit a family’s generational wealth. And so you add hard work to those twin virtures and you would have beautifully summed up a few of the golden rules my siblings and I were made to live by.
Recently , I got a call from Michelle( not real name of course), an old friend soliciting for help. Our conversation went like this:
Michelle: ”Hi Osmund. I know this feels kind of awkward but can I ask you for a favour?”
Me. Oh sure! Why not?
Michelle. ”Ok. Again I know this is a bit awkward but please feel free to say no. I will not hold it against you, I promise.I need to ask you for a huge favour though”.
Me: Please Michelle ! By all means.
Michelle. ”So I finally got a job after all these years. Problem is in order to keep it, I need to be able to drive. Osmund, am ashamed to admit I have a terrible credit history and no car dealership will even look my way. Would you consider helping guarantee a loan for me to purchase a little car? Am not asking for you to do it for free though. I will pay you for that”.
And so she explained to me in great detail how she ended up with the trap of a credit card debt at the very young age of 17. Even after many years of monthly payments made to pay it off, the principal remained untouched. It felt like she stood no chance of coming out of the it and so she decided it was best to just quit paying. That was how she ended up with a bad credit that screwed her life over.
I commiserated with her but at same time made a passionate appeal that she consider other option that doesn’t involve taking out a loan.
It took me a while to convince her but finally, she was able to understand the freedom of not having to make a monthly payment or be indebted to someone over a long period of time. In the end, she settled for a cash buy which though less grand, was a fraction of the cost of the first.
Our little discussion had yielded tremendous result. It saved a friendship built over many years but most importantly made Michelle extremely happy.
Everyday all across America , we all encounter the likes of Michelle. Everyday folks that fell victim to a system that did little to explain the risks but very unforgiving of their mistakes.
For sure we need to take personal responsibility for our actions but I can’t help but worry that some of the poor choices were made in part from a lack of understanding of how the financial system works in this country.
It never ceases to amaze me that we spend countless hours of didactic learning Pi and Calculus but not a word on personal finances. The knowledge of which we all know without doubt ,will greatly impact the economic future of most people. Something that essential to living a happy and successful life.
Apart from those life lessons passed down to me earlier on ,my very first intro to the world of personal finance was very late into my professional life. Even then , my Ghanaian friend,Kofi and I had to be lobbied into participation with the promise of a paid launch in an upscale New York restaurant . Obviously out of Ignorance of course.
Looking back today ,my only regret was that I should have being part of that discussion at least two decades earlier. For an hyperbole will not overstate the transformational nature of that interaction in my quest for financial freedom.
It’s hard to believe that those who design America’s academic curriculum do not understand the importance of financial literacy. I have to resist trafficking in conspiracy theories but one has to wonders if this is willful ignorance or the conspiracy of silence. Whatever the case maybe, I believe it’s time to make financial literacy an integral part of our educational curriculum.
Osmund Agbo, MD, FCCP writes from Houston, Texas