CHOICE membership

"Dishonesty, greed and blatant customer recruitment should have no place in Australia's classrooms"


#1

CHOICE CEO @AlanKirkland talks Dollarmites on ABC News, and why it’s time to get Dollarmites out of schools:


#2

What’s needed is a publicly-owned bank that can be used to give school students their first experiences of banking and saving. :thinking: Oh, wait.


#3

… and here’s me thinking CBA are leading the kids by example on how to be perfect bankers and politicians :wink: Get 'em while they are young!


#4

There’s also this ASIC Moneysmart program for kids as another education tool.


#5

And how about McDonalds and the like out of schools and hospitals while we’re at it.


#6

I agree wholeheartedly with the sentiment, what should be taught in schools should be money management and the pitfalls of credit cards. The pitfalls of phone plans, that are just glorified credit agreements.


#7

It may also be useful to consider what other causes need to be considered and addressed if there is to be a more complete response. Credit in a consumer sense (if that also includes a mobile phone plan) is seen by some as a symptom of a problem or for others a solution to a need.

Credit cards and mobile phone plans might be risks to some. Responsible marketing and educated consumers may be important for change to occur. Better Financial Education at school age would seem a priority.

For school children one key role model is what happens at home.

If parents use credit and purchase phones on plans at home it may devalue any in school teaching that differs as through the eyes of children there are contrary values? A second equally important role play might be that of the playground. For some the status and competitive nature of technology between the haves and have less is still a significant influence. This may be a reflection on individual personality as well as home circumstance.

The practice of the CBA insentivising staff involved in school banking is plain wrong. The other aspects of the program tying support of schools by the CBA to savings outcomes was accepted by each involved schools parent’s committees and leadership. Participation was their choice. Accountability appears to be demanded of others and just not the CBA. From state departments of education down it has been too convenient.

We chose to open personal accounts for our children separately to the school. Back in history when banks closed at 3pm the school program by the CBA and possibly Westpac from memory served a wider purpose. With deregulated banking hours it would seem no longer necessary. Nor does the program reflect how most of us manage our banking needs.

Perhaps in getting parents to take a lead in introducing children to responsible banking and financial management, rather than school banking, there is a second goal in making all of us think about how we could better manage our finances too?


#8

Yes, the public CBA ran accounts encouraging children to save for decades. When the Government sold us the CBA that we already owned, it then became a marketing tool for gathering new customers. Appalling when you think it through.


#9

What privatisation was ever associated with thinking, let alone thinking it through?


#10

It depends on your financial stake in the matter as well as related political affiliations… Those who will profit, and often profit greatly, have thought it through arm in arm with their ‘honourable’ representatives who make it possible.

Re the Cynic Quiz, I believe my raw score for government was a 64 bit floating point underflow.


#11

Oh they think it through all right, but from their perspective and not the society.


#12

Never attribute to malice” I’ve heard it said “that for which stupidity adequately accounts”. You’re probably right though. It’s wise to view every privatisation as a product of evil, unless it’s proved otherwise. There’s undoubtedly an element of evil in all of them.


#13

I don’t agree that schools should teach kids about finances and money. That is the job of parents. Too many social ills are being forced into schools to correct. Money management and credit cards are simply the latest thing to foist onto already overworked teachers and crowded curricula. Let teachers do the job they are paid to do (have you seen the appalling results in basic reading, writing and maths?) and stop asking them to take on parental responsibilities and solve every social ill parents are too lazy to address themselves.

When parents abdicate their own responsibility you cannot blame ‘big business’ for filling the gaps (Commonwealth Banks and McDonalds mentioned here but there are others under the guise of sponsorship).


#14

You don’t think that the basics of handling money are applied maths? Simple versus compound interest rates, differences between interest-only and principle+interest loans, the type of accounts (transaction, savings, money market, shares)?

There is a credible argument a lot of parents don’t understand ‘it’ themselves. Some parents do not understand they do not understand and a few don’t know anything about much nor care as a result of multi-generational degradation of broad life skills. A family in multi-generational poverty may not have ever acquired any operative financial skills; who fills the void to up their ability to manage what they have?

I never thought to consider basic finance as a social ill, although not understanding it is a problem across some of the workforce. Considering how the banks have been operating I accept banking could be considered representative of a social ill (eg lack of honesty and integrity in dealings) and having no place in the classroom. However understanding what banks are supposed to be doing at their most basic remains an important life skill.

That I can agree with, but sometimes business comes knocking even though there was no identifiable problem just a business opportunity, and ‘the parents’ naively welcome it in. Re the Dollarmites the parents with eyes probably shut through a lack of nous themselves welcomed a marketing operation for a dollar in their school’s account. Somehow the ‘pump’ of life skills needs to get primed and it is fine to point to the problem, but even better to offer a workable improvement if not a perfect solution, especially when the problem is complex and pervasive.

Government sets a fine example about that.


#15

I think there needs to be some balance here. The Commonwealth Bank has a financial literacy program for schools ( StartSmart) which is free for schools and does not promote bank products. While other organisations talk about the importance of financial literacy for our school students, the Commonwealth Bank is actually putting words into action.


#16

Well said @mark_m. It is about time some parents took responsibility for their children and stopped expecting the government to do everything for them.


#17

We’ve received a few anecdotal reports of the CBA approaching young people (18-year-olds), offering them credit cards when they barely had savings to their name - a scary thought! :confounded: They were able to promote banking products to these young people because of their involvement in the Dollarmites program.
Just wanted to ask if anyone here has had an experience like this with Dollarmites? Or know anyone who has?


#18

Compound interest is so basic to dealing with any kind of loan or credit yet so many don’t get it. It is really fundamental to finance and thus to modern life.

An allied concept that is basic to any kind of understanding of growth of living things or resource usage is exponential growth. Too few really get it and this allows many foolish misconceptions about the relationship of humanity to the world to persist.

These things are basic maths.

Any school that allows any student to leave without knowing how these two things work in practice is failing miserably.

Here’s an idea. Instead of adverts for loans showing a comparison rate they should show the total interest payable during the term.


#19

Most people do not understand what the comparison rate is regardless. The section ‘how the comparison rate is calculated’ is pretty special. It is ‘not your loan’ and thus can be misleading.

https://www.tomorrowfinance.com.au/blog/comparison-rate-definition-how-is-it-calculated

The summary line is depending on your loan size the comparison rate may not actually be a good comparison tool for your situation

In contrast the US requires the Annual Percentage Rate (APR) that represents the true yearly cost of your loan, including any fees or costs in addition to the actual interest you pay to the lender.

You do not often see the fallacy of our ‘transparency’ being called out, and unless your loan fits the definition of the comparison rate loan the number is a furphy.


#20

School banking under review:

https://asic.gov.au/about-asic/news-centre/find-a-media-release/2018-releases/18-313mr-asic-announces-review-of-school-banking/