A shutdown question: Do you have a rainy day fund?
Regardless of where you fall on the political spectrum, if you live in the US or Canada you’ve been drowning in news of the “government shutdown.” Underneath the political tag lines, I’ve been hearing a refrain that I discussed with my College Success Strategies students last quarter: Many Americans live paycheck to paycheck. CareerBuilder puts this number at 78%. In fact, many families, 40% according to the US Federal Reserve, can’t cover a $400 emergency. Among non-retired Americans 25% have nothing saved for retirement. The Canadian Payroll Association suggests the situation isn’t much better in the north. Half of Canada’s workers are surviving paycheque to paycheque, with 47% saying a one week delay in pay would making paying the bills tough. About 35% of Canadians report being overwhelmed by debt.
In a world with buzzing economies and incredible wealth creation, how did we get here? More importantly, can we find non-political, non-insulting, and useful ways to discuss these issues for the betterment of all? I believe adult educators and those in helping and advising roles can do better.
Ditch the blaming and shaming language: It’s true that many people are in financial dire straits because of bad decisions. Perhaps even decisions YOU as a teacher, coach, or mentor think were obviously wrong. However, it is not possible to educate and attack at the same time.
Make homespun sexy again: Model those behaviors that lead to better spending habits. If you’re a teacher bring your lunch or water bottle instead of waltzing into class with a fancy expensive coffee. In your personal life encourage stay-in-do-it-ourselves evenings (movie night, game night, shared cooking) in place of expensive outings. Coaches and mentors can suggest clients and mentees explore minimalism as part of their overall career and life plans.
Encourage financial literacy: Many people don’t understand how money works. Even those who have mastered the basics of budgeting can be led astray by slick advertising or deceptive fine print. Colleges and universities can help by offering no shame workshops and training on budgeting, finance, and student loan realities. All of us can read more about money, budgeting, and economics.
Obviously there are realities that a short blog with an education bent cannot address.
· Cost of living increases have outstripped wage increases for over a generation now.
· Technology has reshaped several industries and there are some jobs that are never coming back.
· The gig economy (using contractors and freelancers instead of hiring full-time employees) is here to stay.
Yet, we can take conversations about financial realities out of the shadows, and talk about earning, spending, investing, and giving as a normal and expected part of personal and professional education and development. We can work to reduce financial insecurity.