OK, we are continuing into the last part of the discussion “Is Financial Illiteracy An Excuse?” (Go check out that if you’ve missed it…or don’t because I’m not your boss xD)
Here are the poll results! We had a total of 148 votes from different individuals on the Twitter platform.
The poll isn’t officially closed yet but the percentages are not moving very much now because of the volume of votes so we’ll just report the percentages now since none of them are that close to each other.
Question: Do you think financial illiteracy is an excuse?
43% of Twitter voters voted for “No, we all gotta work it.”
36% of Twitter voters voted for “Depends on each case.”
20% of Twitter voters voted for “Yes, we all make mistakes.”
My response? I’m very surprised! I am also surprised the responses weren’t any closer to each other. I thought “Depends on each case” was going to be the clear-cut winner.
Winner: No, we all gotta work it.
Very interesting and definitely won’t be my last poll on Twitter – that was fun!
The most popular (determined by twitter hearts granted) poll responses:
ZDF at 8 hearts and Guy on Fire at 4.
Finance Stoic at 7.
Accounting for Freedom at 6.
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Promise You Won’t Get Mad…?
OK for the rest of this post specifically, I wanted to talk about exactly why I think some personal finance bloggers are most likely…very ineffective despite I’m preassuming, good intentions. For most of us, it’s just a second writing gig that doesn’t pay.
I’m including myself in this (poster kid for least effective in fact!) as well so don’t throw tomato sauce on me.
I grew up thinking rich people held their money secrets from poverty-stricken, stupid people of the world. Some part of me still kind of think like that.
By all logical standards, someone like me shouldn’t have known about compounding or bonds or mutual funds. That’s for the presidents, the astronauts and the kid whose parents could afford to buy him Apple products.
But the most likely reason is simply that really we’re just stuck in our own social bubbles.
There ain’t nothing more to it than that for 99.9% of us. And don’t say you’re not affected. It doesn’t matter how smart you are, if what you see makes up the majority of what you internalize then you are going to be a byproduct of your environment.
OK, no throwing tomato sauce now, remember?
For us, I often wonder…how many of us who are aware of the growing wealth divide and the financial ignorance among people with lower income truly reaching them?
I’m going to be honest…
The most vulnerable people that need to be reached?
None of them are here.
Or not enough of them. Not by a mile. I sometimes think…maybe most of us would be more effective offline. It shouldn’t just be about spending time online blogging about personal finance. Blogging is really good for awareness to a specific audience but not directly effective to the people being addressed.
Life is a number and percentage game (thanks Olivia). How many will waft over that would be as effective as going to find a direct point of entry to the source?
I mean there is value in the trickle-down of information but that happens in an unfiltered world. We live in an extremely filtered world.
We got our social bubble, our own cliche, and echo chambers.
Without that bottom line, there’s less to the point. We should go to the source for maximum effectiveness.
Those people are hard to reach because their environment is pervasive. I know this because I was there!
Brother, I couldn’t even afford a computer back then. $29.95 a MONTH for web surfing? HAHAHAHAH!
And I didn’t see ANYONE (teacher, mentor, community volunteers, blogger) come to my low-income high school in the inner-city to teach about the basic principles of saving and investing. We needed that information the most. Those bastards…(totally kidding! They were just OK with how meh the education system ran.)
Sorry to be blunt but…most of us…sitting at that desk, having the privilege (time, energy, knowledge) to blog can be seen by actual working people that are not like us…as pretentious. Just like what I’m doing right now, sitting behind a computer, type, type, typing away in a cushiony chair with a meeeeeeellon dollars.
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It’s Super Effective!
Go to the source. Youth centers, church, set up a class with the local middle school, community college, go out to the real world and turn that financial passion into action. Walk up to some 19-year-old cashier and strike up a conversation. If it was me, back then, I would have appreciated it; I would have thought you were a little random/weird/not applicable…but will appreciate it 😉 and maybe that will have sew the seed to me investing my own savings sooner.
It’s also more effective to reach out to some media people you can trust to deliver actually helpful information. Organize something with them because blogging is the most passive activity for this stuff. 0% of people (like a young me) who actually needed and probably would have appreciated the knowledge, badly, will even hear it or read it unless someone broke through.
The people who truly, desperately need financial education are not usually the ones who read personal finance blogs so MOST are wasting breaths.
The people who need financial education don’t read personal finance blogs in any way shape, or form familiar with “personal finance.” 🙁
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OK – something actually helpful now…
A friend of me and my hubby’s is a tax volunteer called VITA (Volunteer Income Tax Assistance) and elderly tax assistance. I remember reading a few PF bloggers in our community are already volunteers. You sign up online then the IRS partners with a local organization to offer training (1 or 2 days) and they pair you to help with someone that needs assistance filing so they get the most of their money back.
He doesn’t have time for a blog so I wanted to give him an appreciative shout-out here. You know he wasn’t even born in America! He immigrated here a few years ago from Russia to work for Ooooogle and he’s already making a difference to real Americans like you and me. You go Andrii~!
Guys, what did you think of the Twitter poll results? Am I still allowed to go to FinCon next year or will there be an ambush…?
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Penny @ She Picks Up Pennies says
So when I look at these comments about financial literacy, two things are glaringly obvious to me that aren’t to other people because of my perspective as a teacher. Financial literacy/consumer ed IS required in many states. And it’s being integrated into other curriculums without any fanfare. For instance, the Common Core (you know that thing that everyone criticizes without actually understanding or even reading?!) has entire strands in history/social science THAT SPAN YEARS. That’s problem one. Problem two fits exactly what you’re saying. All of these tweeters and bloggers and critics are stakeholders. Their tax dollars speak and they speak LOUDLY. If you see a flaw in your local school’s curriculum, address it. Volunteer at a school. Show up to board meetings when a curriculum is opened up to the public and voted on. Demand that teachers be held accountable if they aren’t teaching the curriculum with fidelity. And for Pete’s sake, help the kids in your community practice those skills. 🙂
This is a really long-winded way to say that I agree, Lily. We need to meet people where they are, and it’s actually much easier than we think. ::end rant:: 🙂
Man was that professional advice if I ever hear it! I wanted to say that a lot of FI/RE people don’t have kids or have less children. Not exactly the PTA full tour kind of people. Myself included!
Mr. Groovy says
Hey, Penny. I don’t trust our schools. The surest way for young people, especially young women, to screw up their financial lives is to have children out of wedlock. Do our schools have the balls to include this sad reality in any financial literacy program they teach? Another sure way for a young person to screw up his or her financial life is to take out $100K in student loans for a crap degree. Do our schools have the balls to say not every college degree is worth the time and cost? I’m afraid our schools are too PC to do financial literacy and wealth studies right.
OK I do agree with Mr. G on the PC. Schools can get sued and there’s a lot of “let’s not rock the boat” there. I know a few girls who got knocked up in school, they’re all doing terribly financially (at least for now).
It’s funny I was thinking about that recently. Are PF bloggers the only ones reading my blog? What value I am adding? They already know everything!
One of my co-worker is volunteering this year to do tax returns (same as your friend) and I decided I will do it next year, so many people get overwhelmed with basic returns.
I also try to help the people around me whenever I think they may be struggling with their finances (including my tenants!) but it’s hard to help without being too intrusive sometimes.
“They already know everything!”
Me too! I swear everyone knows how to budget basically – what in the world am I writing!
Money is so sensitive, being intrusive is my #1 fear too.
I agree that our blogs are not reaching the people that need the help the most. I often feel like I’m preaching to the choir. The people reading my stuff are other bloggers and fellow “money people.” Getting and audience with the people who need financial help the most is a huge challenge.
We’re all preaching to the choir, that’s why this community is so cohesive. Impactful? Nottttttttt really.
Ms ZiYou says
Interesting article Lily ! And I know no school here teach anything like personal finance.
However there seems to be an assumption that most personal finance bloggers are blogging to try and help others financially. While I agree some maybe, I certainly wouldn’t put everyone in this category.
You’re in the UK yeah? I’m surprised! Not even in the UK!
Ms. Frugal Asian Finance says
Interesting poll! I learned a lot of the saving tips and frugal habits from my parents and extended family.
The only thing I learned about investment from them is that I should invest in real estate lol But it’s because the stock market in Vietnam is pretty unpredictable, and no one trusts other people with their own money. When you buy a house, at least it will be under your name, and it will appreciate (for the most part).
Ohhh that’s a great point. That’s the same in China. Chinese people love real estate 😀
Tell it. This is something I feel a lot, honestly. I know that I write to a small bubble of people. I have a couple of friends with financial problems who now read the blog and honestly, that’s who I write a lot of my posts to these days. But you’re right; Mr. ThreeYear and I should be out there coaching a financial literacy program or going into high schools and teaching financial literacy. It’s good to be challenged. Thanks for the battle cry.
There’s a business idea! Online financial coaching for free as a volunteer thing!
I think the problem is that most people are uncomfortable talking about money. Including me (and I blog about it)!
I love the idea about getting involved in the tax assistance. I’ll have to check and see if there is anything available in our area.
I don’t think anyone should trust me to do their taxes….even with training! But I can help them budget! Haha
Jim P says
Interesting post Lily. This is something I’ve struggled with. I framed the question to myself….”Are you seeking financial independence or social status rise”. It’s not really an easy thing to answer, and maybe they aren’t mutually exclusive. I do know that I hit a brick wall with wanting more time, than adding more to the pile of cash.
No matter what, I think I will always associate myself with those that have less, and that might be hindering some potential growth. While I don’t believe wealthy people “withhold” their secrets, they might use their leverage to pitch things or ideas that aren’t particularly safe. When you work up from nothing, it’s much harder to lose your gains than if you were simply given them. So an overly conservative strategy can also limit some potential big gains. But I’m ok with that. Safe is boring for most people, but it’s a lesson that “builders” can’t forget. “Bigger ships can venture more, smaller boats must stay near shore”.
Interesting thought Jim. I don’t think they’re mutually exclusive and I feel like you, I will always associate myself to those with less.
Angela @ Tread Lightly Retire Early says
There is so much truth to this. I’ve attempted in real life to work with some friends on the financial basics, but it’s hard once they’re in their 20s – 30s – 40s and very much stuck in their ways. Serious kudos to the teachers who are bringing this to their classrooms where the younger students are at least more likely to have some of it sink in. At least I hope so. This makes me want to go out and volunteer and find a way to make a real difference.
I know the struggle, I got a recent $$ update from Soapy and it’s so bad she is ashamed to tell me all of it.
Mr. Financial Freedom Project says
Interesting take, and something I’ve been wondering about myself as of late. It does seem somewhat a quandary that the personal finance blogging community often seems to be an echo chamber of sorts. How to share all of the collective knowledge and information with those who need it most?
The idea of doing workshops / financial literacy training on a volunteer basis is an intriguing one. It’s also a challenging idea – it’s much easier to share knowledge from behind a keyboard than it is in person, particularly for those who (like myself) identify more as introverts than extroverts. A good challenge, and one I’m taking under consideration!
Keyboards are much less awkward haha.
Tawnya @ The Dancing Dollar says
Lily, I needed to hear this today. I started blogging to help others, but to be truthful I am going about helping the financially illiterate in a somewhat ineffective manner. You have inspired me to rethink how I can reach students, who I once wanted to educate on personal finances. There are so many finance things that I wish I had known sooner. So why not be that mentor to those who are ready to learn, but may be overwhelmed by the vast information out there. Thanks for writing this truth bomb post.
Hahaha “truth bomb post” but I wish I had a better solution.
Joe @ Retire by 40 says
You’re right. My readers are self selected, for sure. If you’re not interested in early retirement, saving money, or investing. You’d never find Retire by 40. That’s okay, though. You have to speak to the people that will listen. Readers that come to my site is already predispose to listen to what I have to say. I’ve had posts and been featured on mainstream sites and the comments are full of hate. Most regular people are not receptive to what we have to share.
Good point about working with young people. They would be much more receptive to FIRE than people who are already set in their way. I think it would be much more difficult in real life, but probably a lot more fulfilling too. I’m not sure if I have the gut to put myself out there IRL.
“I’ve had posts and been featured on mainstream sites and the comments are full of hate.”
I find that so hard to believe. You worked as an engineer, saved money and retired early, why in the world is that controversial. That’s some jealous hatin’.
“Most regular people are not receptive to what we have to share.”
Yup, I always thought FI was a genius concept but not everyone sees it like I do. That’s like someone who doesn’t like oreo shakes to me…how can you not like oreo milkshakes??
C @ Working Optional says
You hit the nail on the head! I’ve been pondering over this recently. My challenge that I’m trying to figure out is “WHO” am I writing for, combined with HOW I should reach them where they are. I haven’t found the answer to the second yet, maybe I just have to keep at it.
I like the idea of volunteering – it will be personally fulfilling and will have a deeper impact on both. That said, a blog with a large reader base can have a much wide impact in general, but of course only as deep as the reader chooses.
I almost included the exception of MMM and Fin. Samurais of the web world! Their impact is huge because of the fame and SEO power.
freddy smidlap says
i kinda just write for myself to become a better writer and to learn about this blog thing in order to put one out later with some miles under my belt with more interesting subject matter. l enjoy personal finance but like prosciutto and hookers even more.
on a more serious note, what ever happened to home economics in school? i think they just tossed the whole “economics” part of that where personal finance skills could at least be introduced. now i gotta read about the super secret idea.
Haha I had one class in home economics before they cut it from the school circulumum. I wonder what happened to the home econ teachers…what’s a backup job for that???
This is such a good point! Echo chamber, indeed.
One thing I’ve been thinking about it whether commenters are always bloggers. I for sure didn’t start commenting until I started blogging. although I’d lurked for a long time. Maybe there is a slightly wider readership than people believe, but the ones who respond in comments/social/etc are just the super diligent ones?
I see the backend of my blog and honestly…I don’t think that’s the full case, I wish though. I don’t get a lot of post views but I always get lots of awesome comments. I don’t think anyone will find me nor would I make a huge impact 🙁
Mrs. Kiwi says
Excellent points! I literally graduated from the same high school as the founder/creator of Google, so that comes with so much educational privilege. Even though I knew NOTHING about investing, I knew how to research it and that I should look stuff up and learn.
I always wonder who reads my blog…
I’m starting a $ book club with my library to give back some financial literacy and knowledge, but obviously that will attract certain people more than others. But it’s a step!
Oooooooh that bookclub sounds like a fun idea! I came from the same high school as OJ Simpson hahaha. Ayee..
Very good and thought-provoking post, Lily! You speak the truth here, and you have “been there” and know firsthand. I really enjoy FI and FIRE blogs, but while they are mostly preaching to the choir, most are motivating to the choir. Really, really good points about not reaching those who need it most, though. VITA and school or teen program involvement/outreach do sound like great ideas. Maybe the FI/FIRE community of bloggers should start a challenge of some sort amongst themselves, like a community service challenge, that might catch “Fire” with their readers/the choir!
Thank you Lisa! It’s really true we’re “motivating to the choir” not that there’s anything wrong but it’s not impactful as a joyful side hobby. A lot of FI bloggers including myself are tame folks. It’s calmer behind the keyboard. Someone said it could be a legal liability – giving financial advice, which is a scary thought but my goodness isn’t that a real-world kicker. You might get sued for helping people?
Accidental FIRE says
The people that need it the most – you’re right. They’re not browsing PF sites, nor are they browsing the web much at all. The poorest of the poor just have to be reached in other ways, and they need a different message too.
But I do believe we can reach people who need the message. As I showed in a recent post, folks who make good money still have tons of financial illiteracy and ignorance, and waste their money. I think there’s hope of reaching some of them, although they surely do not need it the most.
OH YES that was a great post. I was so surprised how financially ignorant some high earners are.
Katie @ Retiring To The Road says
This is so great. Like many others, I’m also trying to figure out who I am writing for. I was inspired to start writing after a coworker confided in me that she never asked the financial questions that she had because she didn’t want to seem like a “dumb woman”. My goal is to write for someone like her that is just starting out on the road to financial literacy but, again, I don’t know that those people are going to find me. I am actually a teacher so now the wheels are turning as far as how I could get this message into schools…
Hehe oooh, exciting Katie!!! Go for it!
Sean @ Frugal Money Man says
You are 100% correct in your assesment of “It doesn’t matter how smart you are, if what you see makes up the majority of what you internalize then you are going to be a byproduct of your environment.”
We are ALL a direct mirror of the company we keep. You can start to pick on these small little things like smokers generally seem to hangout with smokers, drinkers with drinkers, sports player with sports players, money people with money people, etc. The list goes on and on. Your spending/investing habits typcially mirror the patterns of your close inner circle.
The challenge is how to potentially seperate from that circle if they are providing a negative influence on yourself. Maybe even more difficult, you actually have to acknowledge their is a problem in the first place!
Yup Sean! A lot of people don’t know there is a problem or see it. Echo chambers. I had to get out of that myself and that’s not smarts. There’s tons of people I grew up with that’s smarter than me.
The Poor Swiss says
I never thought of personal finance blogs like this. It’s a really interesting perspective, thanks 🙂
I agree that the people that would benefit the most from such blogs are the people who are not reading it. I think that most of the readers can benefit, but these are only the people that are aware that they have a problem and are searching for these blogs. As such they have already made the most important steps and are willing to learn. It would be awesome if everybody was aware of this, but it is not the case and probably will never be the case.
I doubt it too. We are a very closed community.
Erik @ The Mastermind Within says
This is why on my blog, I preach about how consistent efforts over time result in wild success. I also talk about how personal finance and self improvement tie together, because if you get your money in order, then you are able to pursue the things you want without getting stressed out about how much money you have in the bank.
Looking forward to seeing you at FinCon 🙂
Who says I’m going!! I’m shy!
Haha I clicked on the “made you look” meme.
We are all preaching to the converted here.
Lol I was hoping someone would notice that!!! Just a silly prank :3
Mr. Tako says
Hi Lily — You specifically were not one of the people I was calling out as arrogant in my post. You can be mad at me if you want, but
I think it’s great your thinking about this stuff.
Most of us with the time to blog have been touched by significant privilege. You and your husband included.
We may not have started out that way, but it *is* where we are now. I don’t intend to forget where I came from. 🙂
Lol whaaaaaaat how can I be mad at you :O nah, you’re not arrogant, I just thought you were very brave to do that topic so I copied…your balls for the lack of better phrasing.
Mr. Groovy says
My blog ain’t doing shit for the financially illiterate. I know I’m mainly preaching to the choir. And I have often daydreamed about being a volunteer life/finance coach to two or three low-income, single moms. But I never did more than daydream about that idea. The VITA program, however, does look interesting. Thanks for the gentle kick in the ass, Lily. Lord knows our schools aren’t going to lead the charge in the fight against financial illiteracy. It’s got to be a grassroots effort.
Don’t worry either is my blog Mr. Groovy! Most of the time, even direct impact can be minimal. The universities are to blame for that uptick in price, it’s not just the lack of fin. education, a lot of us graduate into the Shark’s mouth.
Financial Sloth says
I just did a little post on Money Mindset and I think it gets at another part of what you’re getting at here. It’s not as much about Financial Literacy as it is the entire mindset about money and savings in this country. Money is evil. Frugal people are “cheap”. I have friends who live very close to check-to-check that tried to chastise me for comparing prices on yogurt one day. On top of that, talking money can end up in uncomfortable silence because it’s not a “polite” thing to talk about. So even more important than education is cultural mindset about money. I love money. I also love people, and the environment, and puppies. Being frugal and wanting wealth doesn’t instantly turn you into Scrooge McDuck! Thanks as always for the post. – FS
Read and commented 🙂 (sorry it took me a while, there’s so many of us! xD)
Jason Butler says
Very interesting post and results. You hit the nail on the coffin when you said that people don’t go to the source. A lot of people in the comments are correct. The people that need financial literacy the most don’t read our blogs. We have to find other ways to reach them.
A few years ago I was trying to figure out how to handle my family’s money. I was maybe 35, lots of debt, good income, four kids, but we kept getting further in debt. And I’m fairly intelligent. It’s not like I didn’t understand the math, it was that I didn’t understand the behaviors and habits that were at the heart of our problems. So I googled how I might increase my income. Long story shortened – I ended up finding MMM’s blog and binge read it for the next week. Then I found jlcollinsnh, then Paula, and so on. So, in short, you’re writing this for the person like me, who will find it looking for answers and change their lives. And your audience is more my kids than me, because you write and sound like them.
There are a lot of people who need a financial education. But I do think that you can get to the people who need the help the most. People who make good money still can be very illiterate and will often ignorance financial advice. I think there’s hope of reaching some of them, although they surely do not need it the most.
Depends on the goal of the PF blog, surely?
For example, I write for a target audience of a) people who might be interested in following my ‘journey’ towards wealth, b) those on a similar path that are looking for some ideas/experiences that might be applicable to them. So I hope to be effective at giving such people the occasional ‘tip’ or make them aware of some aspect of personal finance that may be useful to them. I’m not actually trying to be effective at communicating the basics of personal finance (or financial literacy) to students at a low-income high school.
Then again, the fact that hardly anyone reads my blog suggests it is, indeed, ineffective. No matter what its goal 😉