Heartened

"For teachers of psychology, the implications of this study are disheartening. When we teach our students about the behavior of people in the helping experiment, we expect them to learn something they had not known before; we wish to change how they think about people's behavior in a particular situation. This goal was not accomplished in the Nisbett-Borgida study, and there is no reason to believe that the results would have been different if they had chosen another surprising psychological experiment."

So wrote the 2002 Nobel Memorial Prize winner in Economic Sciences, Daniel Kahneman, professor emeritus of psychology and public affairs at Princeton's Woodrow Wilson School, in his book, Thinking, Fast and Slow (2011).

In light of my recent work teaching children about personal finance, I too am disheartened. That is, till I read on.

Nisbett and Borgida went back to the drawing board and came back with this conclusion:

Subjects' unwillingness to deduce the particular from the general was matched only by their willingness to infer the general from the particular.

Or, as Kahneman explains, "The test of learning psychology is whether your understanding of situations you encounter has changed, not whether you have learned a new fact. There is a deep gap between our thinking about statistics and our thinking about individual cases...You are more likely to learn something by finding surprises in your own behavior than by hearing surprising facts about people in general." 

This is encouraging for two reasons. First, it supports my belief that the majority of children's books written on personal finance, despite their preponderance of facts and bold print words, are falling on deaf ears. Kids, hell, all of us, need a more personal story that we can identify with. In other words, there is a place for the series of kids' books that I'm working on.

Second, it paves a way for how to teach financial education in the classroom. While the kids have occasionally oohed and aahed at the cost of college or the price of a home, these facts alone will not establish good financial habits and behavior. They simply map out markets for the kids to refer to in the future. While this is important, it is not the focus of the class. The focus is to establish good financial habits and behavior. Personal stories of kids like them have the power to give the message staying power.

This semester I have focused on drawing parallels to school, an environment the kids are familiar with. Next semester I'll focus more on eliciting personal stories from the kids and using those stories to make points about personal finance. That is one of a few key changes I plan on making.