I Am Adrian’s Mum!

Hi Scott,

In response to your column last week about the Commonwealth Bank’s school banking program, I am “Adrian’s mum from Year 4” and I’m also the school banking co-ordinator for the primary school. Yes, I am a volunteer. In fact there are four of us who volunteer on a regular basis. Even though I run the program, I support the idea of removing big banks from school banking programs and have watched with interest the changes you are trying to make in the sector. But the one thing that keeps the program going at our school is the kickback from the bank — around $800 a year. It is more than some of our other fundraisers! Anything that brings in dollars to the P & C is going to be difficult to get rid of.

Rita

Hi Rita,

I totally understand that the money Commbank pays cash-strapped schools is welcome.

Yet the point is it comes with strings, and it’s your kids who’ll pay for it in the end.

Part of my submission to ASIC will raise your point, and I’m going to add that we need the government to put some money into this.

I’ve always said the CBA understands the value of our kids — it’s time our government did too.

Scott

The Dollarmite Rebel

Hi Scott,

I purchased your latest book, The Barefoot Investor for Families, and gave it to my nine-year-old son, who has taken to it like a duck to water. He is enthusiastically helping with cooking, and has set up his three jam jars. He has a presentation at school coming up and, due to inspiration from your book, he wants to do his talk on why his school should give Commbank the flick. I don’t want to discourage him, as I too believe in the cause -- but is it something best left for parents to bring up with the school?

Barry

Hi Barry

What do I reckon?I reckon this sounds like a life lesson he’ll remember for years to come.Here are a few things I’d talk through with your son:

Explain that a credit card is a very expensive loan from a bank. Young people often get themselves in a lot of trouble with credit cards by borrowing too much. Credit cards tend to make everything you buy much more expensive. For most people -- especially young people -- the best credit card is no credit card.And perhaps he could ask:

Why does Commbank’s Start Smart Program teach kids -- in grade three -- about the benefits of credit cards?

Then he could ask his teachers:

Have you ever got in trouble with a credit card?When we get older, should we get one?

A big part of financial education is to be skeptical about what banks (and advertisers in general) offer up.

You’re teaching your son to be an independent thinker and to intelligently and respectfully question authority.

In this case, he’s got truth on his side: there is no justification for allowing a bank to spend millions of dollars for the exclusive right to teach our kids this core life skill, much less for rolling out a marketing program that is worth, according to one analyst, as much as $10 billion!

Let me know how he goes!

Scott

Is Dollarmites Done For?

Hi Scott,

I read in the news this week that ASIC are finally launching a review into school banking -- maybe it has something to do with that book of yours! What is your view on this? Do you think this could get the banks out of our schools, or is it still too early to get our hopes up?

Ethan

Hi Ethan,

Here’s what I hope the ASIC review will discuss:The Commonwealth Bank’s school banking program has, according to their website ‘been teaching generations of young Australians the importance of saving and lifelong money skills since 1931’.

So let me ask you this:

If what they did worked, why do we currently have record household debt, and low savings?

How did we end up with the horrors of the Banking Royal Commission (where Commbank received a gold medal for charging fees for no service to dead customers, ripping off millions of dollars of retirees’ money)?

And why are school leavers the most financially illiterate of all Aussies, according to ASIC research?

The answer, I believe, is that up till now many schools haven’t given financial education the emphasis it really deserves — possibly because they wrongly assume that Commbank is taking care of it.

The best outcome from this ASIC review would be that schools finally understand that financial education is a core life skill, that is far too important to be outsourced to a bank that pays millions of dollars to market to our kids.

Thanks for reading,

Scott