For most students, college is an amazing experience. I’m certainly no exception — I’ll never forget the great times I had with my friends there. Post-college, however, a different kind of hangover sets in.
After leaving the fantasyland of college, many young people are woefully unprepared for life in the real world. A college education, for all of its merits, completely neglects some key skills that all people need to learn if they’re going to be successful.
Here are five ways college doesn’t prepare kids for the real world.
1. College doesn’t teach kids personal finance.
One day at college, a couple of my friends returned to our dilapidated rental house with fresh Chase Bank t-shirts and matching beer mugs. (I’m not sure if they were designed to be beer mugs or not, but that’s what they were used for.)
“All we had to do,” they said, “was fill out a credit card application.” Obviously, the lure of free made-in-China megabank-branded swag was more than enough to get the deal done.
A few weeks later, both of my friends received shiny new plastic cards with $1,000 monthly spending limits and 15% annual interest rates. These guys were generally not to be trusted with a six pack of non-premium beer, let alone a credit card. Yet banks were all too willing to extend credit to them, or should I say, to prey on them.
Thus began several years of credit problems for my friends. Not too long after, I bore witness to several calls from banks and collection agencies wondering why, oh why, didn’t these 19 year-old kids didn’t pay their bills. I even knew one guy who declared bankruptcy at the age of 22 because of his crippling credit card debt!
I doubt these stories are unique. Colleges and universities across the country routinely allow credit card issuers to set up shop on their campuses. Even worse, however, is the fact that colleges do nothing to teach kids about the dangers of debt.
Perhaps there’s a good reason for the lack of personal finance education, considering the average U.S. student loan debt was $29,400 for the class of 2012. At the very least, colleges are complicit in the $1.2 trillion debt scheme. They’ll happily accept your money, but they won’t teach you about it.
Imagine if the first day of freshman year, colleges were obligated to disclose the average student loan debt that graduates leave the school with?
At my school, every student was required to take an expository writing class, meet certain math requirements, and many programs even forced students to take at least one foreign language course. Yet not one of us was ever asked to learn about personal finance. Most of us left school with no idea how to create a budget, refinance a loan, or avoid debt.
These basic finance skills would have served students far better than the majority of the courses, and in my opinion, should become a prerequisite at every college and university nationwide. In fact, they should be taught in high school as well, but that’s another story for another day.
2. College doesn’t teach kids to sell or negotiate.
If you majored in marketing, you may have gotten a cursory explanation of what makes a good salesperson. But even then, you probably learned nothing about actually selling.
Like personal finance, selling is a skill that nearly all successful people have mastered. Selling also isn’t taught to most college students. Those that do go on to be good salespeople are forced to learn the ropes through a combination of research, mentoring, and trial and error, all on their own. Sadly, most people never learn to sell, and it severely limits their earning potential.
Selling has an undeserved stigma amongst many in academia. Professors may think selling is beneath them, or that most kids won’t actually use the skill. They’re wrong. Selling is involved in nearly every aspect of business.
- If you’re looking for a job, you’re selling yourself to a company.
- If you want to create a new project, you have to sell it to your boss.
- If you want more customers, you have to sell to them.
- If you need a loan, you have to sell yourself to the bank.
- If you want a promotion, you have to sell someone on the fact that you deserve it.
Selling is everywhere. If you can sell, you can work anywhere in the world, and do almost anything. Kids should have to learn this before they graduate college.
Negotiating is closely related to selling, and college kids don’t learn how to negotiate, either. Normally the price of something as expensive as college could be negotiated, but it isn’t, and thus it makes sense why colleges don’t require kids to learn how to haggle. Imagine millions of students pitching schools on why their education isn’t worth the cost, and they refuse to pay that much? That would be a beautiful thing.
3. College doesn’t teach kids how to get a job or start a business.
You’d think that for $150K, college grads would at least know exactly how to put their education to use, right? Wrong.
Most kids graduate without a clue about:
- What makes a great résumé
- How and where to market your résumé
- How to create a kick-ass LinkedIn profile
- How to network with the right people on LinkedIn
- How to nail a first job interview, and follow-up interviews
- How to negotiate a salary
- How to get a promotion, and advance in your career
Shouldn’t all of these topics be wrapped up in a required exit course for seniors called something like “Getting a Job 101”?
And then there’s entrepreneurship, which is all but completely ignored in college:
- How to find your niche
- How to start a business
- How to find your first customer
- How to grow an email list
- How to write marketing copy
- How to get to your first $1 million in sales
- How to scale and grow your business to $10 million and beyond
Even in business school, these topics are barely touched upon. That’s a shame, and kids deserve better.
4. College doesn’t teach kids about cutting edge anything.
Back in 2000, my university barely even had an Information Technology (I.T.) program. Even more embarrassing, the small amount of classes the school offered were borderline useless. Instead, I learned everything about web design, development, and content at my job and on my own.
Little has changed these days. Unless a student is involved in a scientific research program, odds are their curriculum will be many years behind the curve.
Things move really fast out in the real world, certainly several times faster than they move in higher education. I recognize how difficult it is for a massive educational institution to keep up, when many multibillion dollar for-profit public companies can’t. But they should at least try really hard.
Instead, many schools remain mired in the traditional approach of teaching the same old stuff, year after year. And as usual, it’s the students that suffer.
5. College doesn’t teach kids about investing.
If you major in finance, you’ll learn the basics of investing. Probably not much you can actually put to direct use in your own life, but you’ll at least understand how different investment vehicles work.
The other 90-something percent of students graduate without a single clue about how to invest their money. Here are just a smattering of important things that all young people should know, but likely don’t:
- The differences between mutual funds and ETFs
- Why 401(k)s are usually a scam
- The different tax advantages of a Roth IRA and Traditional IRA
- The current 10-Year Treasury yield, what it means, and where it’s going
- What the Federal Reserve is, and its massive effect on the markets
- What separates a good stock from a bad one
- The dangers of penny stocks
- The dark side of the financial newsletter industry
- How to avoid big investment losses
- How to build a diversified portfolio based on your specific risk tolerance
I could go on and on. I’ve spent the last eight years working in financial media, and I can tell you first hand that even seasoned investors fail to grasp the concepts above. So recent college grads really don’t have a chance.
What else do you think should be required for students to learn in college? I’d love to you hear from you, so leave a comment on this post or on Facebook.
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