WHEN I TAUGHT economics, I would present students with the financial misunderstandings that people often have—and which the study of economics can help them avoid. Examples? Here are five widespread misconceptions: Mistake No. 1: The rarer something is, the more valuable it is. Economics really doesn’t care about rare things—meaning those things that are few in number. Instead, economics deals with scarce things, which are things for which there’s greater demand than current ways to fulfill that demand. Why does this matter? People get tricked all the time into buying things because there aren’t many of them or because they may not be around tomorrow. How often is your interest piqued by the phrases “limited offer” or “for a limited time”? The items involved may indeed be rare. But for them to be scarce, you need to actually want them. Do you? Or have the marketers prompted you to feel a false sense of urgency for something you don’t really desire? Mistake No. 2: Comparing choices is about comparing benefits. There’s a reason it’s called cost/benefit analysis. You need to consider not just the benefits of each choice, but also the costs. Everything has a cost—including not only the initial price and any ongoing expense, but also the lost benefit from not opting for the other choice. Mistake No. 3: You borrow from others. When I ask students who they borrow from when they charge something to a credit card, most will say “the bank.” But the right answer is “your future self.” The debt will have to be repaid by your future self, along with any interest owed. In effect, you’re betting that the money you borrow is worth more to you today than it is to your future self. Mistake No. 4: Savings are what are left when you don’t spend. When people get money, they look to spend it. If they can’t find anything they immediately want to buy, they hold on to it. This makes saving money seem like the last choice, the fallback option after looking at all the shiny objects currently on offer. A better way to think about savings: View them as future spending. Do I want to spend now or delay spending until later, when—thanks to prudent investing—the money might have more buying power? By framing the issue this way, you also remind yourself that you won’t be the same person in the future—and that your future self will likely have greater financial needs and more expensive tastes. Mistake No. 5: The goal is always greater wealth. Today, many financial services are about “wealth management.” But in the end, we don’t want more money, but rather greater contentment, satisfaction and even happiness. Money is merely a tool. To use economic jargon, it’s a factor in the production of your happiness. Figure out your goals and then figure out how money can help you get there. It might even be that earning less money, and perhaps spending more time with family, is what you should really be aiming for. Jim Wasserman is a former business litigation attorney who taught economics and humanities for 20 years. His previous articles were Spoonful of Advice, Under the Influence and Gaming the System. Jim’s three-book series on teaching behavioral economics and media literacy,  Media, Marketing, and Me, will be published in early 2019. Jim lives in Granada, Spain, with his wife and fellow HumbleDollar contributor, Jiab. Together, they write a blog on retirement, finance and living abroad at YourThirdLife.com. [xyz-ihs snippet="Donate"]

MOST EVERYONE AGREES financial literacy should be taught to some degree in schools. Even the basics, like how to set up a bank or credit card account, or how to make a budget and avoid debt, should be explained to those soon to enter the workforce. Another group of newcomers to the U.S. financial system who could use guidance are immigrants, particularly refugees. Jiab and I have been volunteering for a number of years to help refugees get acclimated to American life. We’ve learned how much “common knowledge” is actually not so common in many parts of the world. We once had to explain to a family from Myanmar that, if they put uncovered raw chicken in the freezer, it would end up with freezer burn. The same is true for financial basics. Many refugees have never opened a bank account, let alone had a credit card or read a financial statement. Imagine how helpful it would be to them if someone like you, who’s familiar with the system, helped guide them through the basics. To do so, you don’t need to be a financial expert, just someone who’s experienced in avoiding potholes on the road to success. There are many organizations that provide immigrant and refugee services, including introductory financial guidance. In Dallas, we have Refugee Services of Texas, which is currently processing many Afghan refugees, and Jewish Family Service, which isn’t limited to any one faith. There are also organizations and groups that serve low income and undereducated people in general that could use support and donations. I’d encourage you to check out homeless shelters, women’s shelters, community centers and public libraries to see what financial education services they offer—and whether you can help.

GOT SOMETHING THAT needs repairing? Faced with the increasing specialization of people’s knowledge, ever-growing technical complexity and our perennial lack of time, it’s often tempting to just call in an expert or even buy a replacement. But repairs can be costly, which is why we’re told to get multiple bids. One of the “bid” options I always check out: fixing it myself with the guidance of that repository of collective step-by-step knowhow, YouTube. Perhaps not since the Great Library of Alexandria has so much expertise been collected in one spot—along, of course, with endless cat videos and slick dance moves. Battery for the car key fob gone dead? YouTube plus $5 for the battery beats $20 at the dealer. Repairing a gate latch becomes a choice between installing an $18 latch delivered by Amazon or paying $100 for a guy to come out. Same thing with a leaky showerhead. I recently called about a garage door repair. The repairman said he charged $80 just to come out, which would be over and above the cost to repair. Perhaps best of all, there’s that feeling of accomplishment from having both mastered a new skill and saved some cash. As a retiree, I love the small challenges involved. My peers sometimes shrug about broken things and say they never learned to do repairs. But is it ever too late to start learning? A fence repair became a family activity with my sons. My daughter-in-law to be—a baker—changed the oil on her car, courtesy of YouTube tutelage. She was so excited she offered to do ours. Strikes me as a good thing: You learn skills, exercise the mind—and save money. Or, as Ben Franklin supposedly said, “Watch the pennies and the dollars will take care of themselves.” But it seems he got that off the internet.

TEACHERS SHARE space with people who aren’t as knowledgeable or understanding of a subject as they are. Sometimes, students will display incredible depths of ignorance. Most students try, but there are some who are unwilling to meet a teacher even halfway. Worst of all are the insolent ones. Proud of their ignorance, they dismiss the subject—and the teacher—with not-so-veiled disrespect. You know what a good teacher does in the face of all this? She takes a moment, squelches all her frustration and even anger, and tries again. Jonathan Swift observed more than 300 years ago that, “Falsehood flies, and the Truth comes limping after it.” Imagine his reaction to today’s instantaneous, million-multiplying falsehoods that travel at the speed of social media? We’ve all been faced with the sneer of the doubters, adamant about their misinformation. Unfortunately, most of us aren’t good teachers. We shout, we question the person’s intelligence, we throw out gratuitous insults. We could ask for the source of their information. Instead, we opt for rhetorical questions like, “How can you be so stupid?” We need to be good teachers. Spewing venom, even as a return shot, does nothing to educate the ignorant person. In fact, it drives them (and perhaps you) further from learning. It may feel good, but it’s really a prideful display of our supposed superiority. This only tends to escalate the situation. You may say you don’t have time for such lost souls. But that’s like a doctor saying he only treats the healthy and has no time for the truly sick. If you’re out of patience, just walk away. Spewing bile only leaves the other person more entrenched and more difficult for the next person to persuade. You already know this. Everyone does. No one has ever experienced a change of heart after being yelled at or insulted, no matter how wrong he may be. Good teachers also know one other thing. Education is a life-long process. There is almost never an “aha” moment like in the movies. Understanding is gained inch by inch, from open-minded people willing to revisit what they think they already know. It’s a long road traveled on little wheels. It takes lots of turns to make progress—and it goes faster if the road is paved with patience.

APRIL IS FINANCIAL Literacy Month. If that doesn’t excite you, imagine how your children feel. Still, consider this an opportunity to begin or reinforce your kids’ financial education. Many of my students told me one of their parents was into “finance,” but when I asked how the parent handled the family money, students would just shrug and say that was all they knew. Children don’t like a straight-up lesson, especially from a parent. The trick is to make it seem casual and as blended into everyday life—theirs, not yours—as possible. Here are nine ideas for a wide range of ages, from elementary to high school. Choose the ones that fit your scion: When shopping, compare two items, like two shirts with different prices. Ask your child why the more expensive shirt costs more. What do you get for the extra money—and is it worth it? Even better, have your child ask the sales clerk. Ask your know-it-all tech-savvy child to help you set up some money management software. You can then have your child help you “test” the software with one of your child’s accounts, whether it’s a college fund, credit card or bank account. You might monitor the account together for a couple of months to see how the software works, and maybe have a conversation or two about financial issues along the way. If you have a 529 or other college savings plan, include your child in monitoring its growth and how the balance compares to the current cost of college. Maybe have some strategy sessions on how to pay for college, which might involve looking at U.S. News & World Report's list of best value schools. Take a look at some mutual funds or individual stocks related to your child’s interests, which could be anything from fashion to sports to environmental sustainability. Make predictions about what will happen if, say, a new product is rolling out, and then check back a month later. Talk about why you were right or wrong, and what are good business strategies. Put some creativity into a family budget challenge. Pick a family event, like a vacation or outing, and figure out how it can be done in a less-expensive fashion. Incentivize creativity by splitting the savings with your child, or using a part of it for an extra activity. Ice cream is good. Delaying gratification is an important skill. Small children’s abilities can be tested—and then discussed with them—using the marshmallow experiment. For older kids, have them set a goal of buying something they want later, say at the end of the year. Then promise to match a percentage of the money the child earns or saves toward the purchase. Make a thermometer chart to keep track. If older children want money for something, ask them to make a presentation, similar to a business seeking a grant. Have them lay out the costs and benefits of getting the money, and then question them about their presentation. Budget a fixed amount for an event, anything from your child’s birthday to planning a “night in Italy” family dinner. Then have your child figure out how to allocate funds to make it the best experience. Whatever your child decides, that goes, assuming it fits within the budget. Don’t come to the rescue if your kid messes up. Spending habits are formed from a lifetime of nudges, so help your children become savvy consumers of media. Watch media your children like, asking them to explain the nudges and overt demands of consumerism they see—from product placement, to banner ads scrolling below the video, to open solicitations. Point out the slyer methods of persuasion or even make a hunt for them. Reassure your children that they’re too smart to fall for these tricks. In the comment section below, feel free to suggest other activities. Do you include your child in buying decisions? Do you try to model smart spending? Responsible money habits aren’t something you tell your children about or, worse still, do for them. Instead, they’re built over time by the things you and your children do all year round and, most important, do together. Jim Wasserman is a former business litigation attorney who taught economics and humanities for 20 years. He's the author of a three-book series on how to teach elementary, middle and high school students about behavioral economics and media literacy. He's also authored several educational children's books. Jim lives in Texas with his wife and fellow HumbleDollar contributor, Jiab. Together, they're currently working on a book, “Your Third Life: Reflections on Finding Our Way by Taking the Long Route.” Check out Jim's earlier articles. [xyz-ihs snippet="Donate"]

AT THE BEGINNING of 2022, I wrote about our resolution to go back to grad school. The short update: Jiab and I are indeed doing it. We’re enrolled in the Master of Arts in Interdisciplinary Studies program at the University of Texas at Dallas. We scrambled to get the application paperwork done before classes started Jan. 18. Neither of us had applied to school for ourselves since the introduction of online registration, but we found it fairly easy. The only holdup was getting our prior transcripts submitted. My undergrad university and law school both said they didn’t have electronic transcripts “that far back,” so I had to have hard copies mailed. A full load is three classes. We opted for two our first semester, so we could get acclimated to school again. Good thing we did. We have a regular weekly assignment load of about 100 pages to read and then writing reflection essays of at least 500 words each. We now complain to our kids that we want to do something but can’t “because we have homework.” The age of the students ranges from just out of college to 60—that would be me—with people from all over the world. The exchange of ideas from so many perspectives is magical, though I sometimes listen to the theoretical descriptions of life and think, “Sorry, it doesn't work like that in the real world, but you’ll find out in your own time.” One of the most intriguing assignments so far was writing an intellectual autobiography. Basically, it’s a review of the events of your life—both academic and personal—that have shaped how you think today. It was daunting at first, especially as I had almost three times as much life to cover as the fresh-out-of-college kids. But connecting the dots of events and influences was fascinating and extremely helpful for my understanding of my understanding (“metacognition” in grad jargon). I recommend it as a great exercise. The professor kept saying that the intellectual autobiography would be helpful in future stages of our life, such as looking for a job. I agreed, though I said it’s best use for my future was probably as a first draft for my eulogy. Jiab and I are determined to keep going. At first, we thought the main motivation to continue would be justifying the tuition we’d paid ($5,462 per person for two courses), plus $250 to $300 in application fees, a parking sticker and books (thank goodness for cheaper or even free online versions of texts). There’s a number of discounted—and even free—tuition programs for seniors, but we didn’t qualify. We’ve come to love the possibilities that grad school is opening up. Jiab is delving deep into gender discrimination, a topic she can look at critically and with greater distance, now that she doesn’t have to worry about the repercussions from speaking out at her job. Similarly, I’m taking a broad view of media literacy, deciding if I want to focus on education reform or advocating for industry change. It’s like when you first start exercising to lose weight but, at some point, realize the exercise itself—and the great feeling that you’re doing it—is the reward. We plan to sign up for summer classes and then take the fall off. As Jiab correctly observed, travel will be cheaper then and less crowded. Now, if you’ll excuse me, I’m on spring break. I gotta show these youngins how to do it “old school.”