Smart money

When sophomore Reva Lalwani was nine years old, her parents started giving her a monthly allowance. Five years later, they set up a bank account under her name and issued her a debit card. The rules were simple: from then on, she would be responsible for managing her own money and financial decisions. Every dollar she spent would be her decision. Since then, Lalwani has been budgeting her money, managing her bank details and writing her own checks. While her friends absentmindedly pay with crumpled 20 dollar bills at the mall, Lalwani hands her debit card to the cashier, silently tallying each dollar in her head. Every month, she gets a set amount of money from her parents to last her the month. She knows that her money flow isn’t infinite.

“I’m in charge of managing my own money and figuring out how much I can spend,” Lalwani said. “They give me enough money so I’m able to do that but I have to make my own decisions.”

Lalwani explains that her parents provided guidance to her in the first few months of this allowance system, advising her on how to ration her money and showing her how to monitor her bank activity. However, at this point, they are completely hands-off. Lalwani is independent, even making her own monthly check-in bank phone calls.

“I get an email and [physical] mail every month that shows my credit history and account details,” Lalwani said. “My dad just gives it to me and he just says, ‘Take this. You know what to do with it.’ I have to look over it and I save all of them. I communicate with the bank on my own because my parents don’t want to do it for me and be the middlemen.”

Unlike Lalwani, junior Shonali Vaidya has no financial experience. Vaidya predicts that her ignorance on the topic will harm her later in life, when she will have to take on all the financial responsibilities that come with adulthood.

“I don’t think that my financial knowledge is anywhere close to anything,” Vaidya said. “I think that it’s one skill that really lacks in our school system, even though it’s so essential.”

Government and economics teacher Pete Pelkey agrees that MVHS doesn’t prioritize teaching students integral life skills for future adulthood, such as finance and money management. He explains that his own high school had more classes focused on these life skills, such as finance, but MVHS doesn’t have a finance course or unit that the entire student body has to take.  

“[In high school], I knew how to write a check and I’d taken accounting so I knew how to balance a budget,” Pelkey said. “We had more elective classes geared to the world of life. FUHSD doesn’t necessarily care about life. We care about the requirements of the UC system and being able to tell the public, ‘90 percent of our kids qualify to go into the UC system.’”

Lalwani agrees that MVHS should focus on educating students on basic life skills. She explains that while there are business courses that delve into finance, a majority of the student body doesn’t take those courses, as they aren’t mandatory. Lalwani believes that a simple solution is to integrate a brief unit on finance into economics or math classes.

While Pelkey does believe that basic financial skills should be taught, he doesn’t think MVHS should offer an entire course on money management. He explains that a lot of trivial aspects of finance, such as writing checks and balancing budgets, are self-explanatory. Like Lalwani, he supports the integration of a brief finance unit into a mandatory course. Pelkey also believes that if a finance unit were implemented, it should go deeper than perfunctory lessons.

“The problem is that if we did it, it would be simple things, like how to write a check, which takes about 12 seconds to figure out,” Pelkey said. “Unless we’re going to get more into how to save money, how to invest money wisely, then I don’t know if it would necessarily be a useful use of time. You want to give them something of lasting value and I’m not sure that that has lasting value.”

Pelkey also believes that a class wouldn’t be effective, as money management isn’t something that can be taught in a classroom, but rather something that has to be learned in the real world. Additionally, Pelkey doesn’t know if teaching students how to make wise decisions will actually prevent them from acting rashly with their money.

“Our telling you how a credit card works won’t necessarily stop [credit card debt] from happening,” Pelkey said. “Credit card debt can be a problem for young people and it depends on impulse control. [So I can say], ‘You should never go into debt, unless it’s for your house or education,’ but people do still need cars, so they may choose to go into debt for that.”

While Pelkey does believe that MV students need more education on finance, he thinks the average MVHS student has a more thorough understanding of money management than students from other parts of the country due to the affluent nature of the community.

However, Lalwani disagrees that MVHS students are more financially-knowledgeable since they live in an affluent area. Instead, she believes MVHS students’ financial ignorance stems from their affluence. As a large part of the MVHS community is financially stable, families don’t necessarily  have to worry about rationing money.

“I have some friends who have debit cards but they don’t manage them at all,” Lalwani said. “Their parents put in money, they just spend it. I have other friends who say say, ‘I want to buy lunch,’ and their parents give them five dollars. They have no idea how much they’re spending or how much their parents are giving them. I feel like a class would definitely help them be self-aware about that.”

Lalwani explains that while her parents imposed the allowance system to teach her money management, they also did it to help her understand the value of money, which is one of the most valuable lessons she has learned through their system.

“Since we live in such a privileged area, where everyone has 1.5 million dollar houses, we have the ability to spend money whenever we want to,” Lalwani said. “I think what they really wanted to teach me was that when it’s your own money, you have an urge to save it, whereas if you’re spending your parents’ money, you don’t. My parents were trying to show me that there’s a difference between needs and wants and that you have to prioritize needs.”

Graphic by Andrea Perng