Episode 73: Solving Income Inequality

Announcer:
This is The WealthAbility® Show with Tom Wheelwright. Way more money, way less taxes.

 

Tom Wheelwright:

Welcome to the WealthAbility Show where we're always discovering how to make way more money and pay way less taxes. Hi, this is Tom Wheelwright, your host, founder and CEO of WealthAbility. Many Americans believe that redistributing wealth can solve income inequality. Can it? Today, you will discover how financial education relates to income inequality and if perhaps that's the solution.

 

Tom Wheelwright:
Now a very special guest with me today, Phil Schuman, who's the senior director of financial literacy for Indiana University and he's actually working on this specific issue at the Indiana University. And that's why Phil, I am so glad to have you with us today. If you would, just give us a little bit of your background.

 

Phil Schuman:
Yeah, I appreciate it, Tom. Thanks for letting me join. Yeah, so I've been in my role at Indiana University since 2011. Basically my job is to help implement financial education to students and actually some faculty and staff as well and just try and educate them on making good financial decisions while they're in school and after they graduate as well. Something you said there, I'm also the founder or co-founder, I should say, of the Higher Education Financial Wellness Alliance, which is a national organization trying to get financial wellness into higher ed's programs. What I will say is our membership base right now has about 200 different institutions represented. We are seeing this grow throughout higher education, which is fantastic because we're really trying to focus on figuring out ways that we can help students really achieve financial or economic prosperity and also just get the degree and not allow financial barriers to come into play, to prevent them from getting that degree. Because again, because of economic mobility, we want to see people get the degree and be able to improve their economics moving forward.

 

Tom Wheelwright:
Here's my first question for you, Phil, why don't schools teach financial education? Why is this not number one on the radar?

 

Phil Schuman:
I think, if you're talking about from a higher ed perspective, I think for a while sort of the hope or at least the thought process was that it would be taught earlier. It'd be taught in homes. It would be taught in K through 12. And to some extent it was, but it was never a consistent thing. As people started coming to college and we started to realize, college isn't just necessarily about the book smarts. Obviously that's what we want people to come and do is get their academics, get their major, go out, find a career in that. But we also realize, we want to make sure that we're graduating people that are prepared for life in general.

 

Phil Schuman:
And so part of that has to be being able to manage money, understanding money and being able to go out in the world and be able to be good stewards of their finances. And so as we started these past few years, it's we're starting to talk about student debt more and more. We started looking at ourselves and started realizing, there are some things that we could be doing better to help students put themselves in a position of being able to thrive financially after they graduate. And so again, these programs have started really picking up and we're seeing more and more of them come out.

 

Tom Wheelwright:
Well, I love that. It's just been interesting to me that you hear a lot about universities talking about social inequality and social justice and they talk about income inequality. What do you think is the role that financial education might play in solving the income inequality? Do you have a thought about that? You're looking at that with your students. How do you see that rolling out as they leave your institution?

 

Phil Schuman:
Yeah, so it's interesting because I feel like this topic has been talked a lot. We've seen research that says or we've seen research, we've seen some anecdotes of people saying, “The reason why some groups of our population aren't necessarily achieving or thriving economically is because of a lack of financial literacy.” And in some cases that is absolutely true, but I think there's a financial literacy gap for all populations. The topics that, where there may be the gaps may be different from one population to another, but the fact remains as a whole, our population is pretty financially illiterate. And so, what we need to try and figure out is not necessarily we should be teaching all of the lower income, the minority students, the people that I think are traditionally thought of as being financially literate. And I think we need to realize that everybody is.

 

Phil Schuman:
And then in some cases, and you and I talked a little bit about this as we were just getting to know each other, I can make the argument that people that are coming from lower income or minority backgrounds are actually smarter or more literate when it comes to their finances, just because they've had to be the ones that have had to figure out how to stretch a dollar on a daily basis. Now, part of the problem though, is when it comes to income equality and trying to I guess, economic prosperity. I think part of the problem too is though those populations don't typically make as much money post-graduation so here's where the income inequality comes in.

 

Phil Schuman:
And so from a financially literate perspective, we start thinking about the fact that they must be financially illiterate because they're not taking advantage of some of the financial products that we would consider to be good things. Their retirement accounts may not be as heavy so to speak or something along those lines. I think we have to sort of separate these two things out. That financial illiteracy doesn't necessarily mean that's what's causing the income inequality. We just need to sort of realize that we need to find a way to give everybody the opportunity to take advantage of the financial products that we would like everybody.

 

Tom Wheelwright:
Yeah. But one of the things we were talking about before is that people who come from wealthier families, they have a tendency to talk about money more and they have a tendency to actually talk about, and they've seen financial success because they actually have somebody to look at, a parent, an uncle, a grandfather, grandmother that has had financial success and that perhaps a lot of other people who have not had that experience. This is why Ivy League schools tend to produce Ivy League children in part because these are people that they've talked about it, this has been a focus in the home. The question is, is okay, if you don't get it in the home, where are you going to get it?

 

Phil Schuman:
Yeah, and I think that's part of the reason why we exist is to provide that opportunity. If you're not getting it through the K through 12 level, we're going to be one of those people that are going to step in and try and help you out. But we are seeing more K through 12 programs like the National Jumpstart Organization. They're really focused on trying to bring financial education K through 12. We're seeing more states mandate some level of financial literacy. The problem though and especially now in our COVID times, there's not necessarily enough money to go around to fund these sort of programs. The state of Indiana does have a financial literacy, I'm going to do air quotes, which is perfect for podcasting. We do have a requirement K through 12, but the problem is there's no funding behind it.

 

Phil Schuman:
And so when school corporations are trying to figure out how they can implement these types of things, they just don't have the ability to do it. And then you also marry that with the fact that a good chunk of college students that are graduating, that are going to be the next round of teachers in our schools, the research shows they're not very financially literate as well. They're not going to be able to graduate and then go into the schools and teach financial literacy because they haven't had that training yet either.

 

Tom Wheelwright:
Well that, to me, I think that's the core of the issue when it comes to the education in the school system is that the teachers don't, they don't have financial education so how are they going to teach financial education? If you're an artist, if you had years of art school and so forth, it's pretty easy to teach art. And if you've had business school training, you can teach a business school. But the challenge is, is that when you talk about K through 12, that's a whole different animal because those, you don't have, one of the challenges is like you said, it's funding. You don't have people who are, I don't see it, maybe you do, I see, for example, I was an adjunct professor for 14 years at Arizona State University.

 

Tom Wheelwright:
You see it in the business school. You see people who are successful entrepreneurs, teaching in a business school, but you don't see that happening in K through 12. You typically don't see somebody retire from a successful business and go to K through 12, go teach high school. The question is, how do you get them financial education? But here's the other side of it. What about financial education outside the school system? Does it really have to be in the school system? Because there's so much financial education that is really inexpensive that's online. For example, I've got a buddy and he's actually financial educator and his son who would normally be in ninth grade, he pulled him out for this year and they're spending the whole year on financial education. Well just doing online courses.

 

Tom Wheelwright:
Well, the online courses are cheaper than going to school. And he's getting all financial education. This is a 14 year old who's learning how to trade stocks. This a 14 year old who's learning the basics of real estate. This is a 14 year old who's learning really the real fundamentals of what true financial education is all about. I guess one of my questions is, you're talking about the funding of the schools, but why don't the schools then they look at the online and say, “Well, let's use that.” To me, it seemed to me that this would be the perfect year for it. You've already started your six year old comes in because she's home. She's at home doing her, her first grade online.

 

Tom Wheelwright:
Wouldn't this be the time to be able to deliver courses that are all, because here's the problem. One of the challenges that teachers are having right now, as I understand it, is they've never done online education before and now they're forced to do something that they're very uncomfortable with. Why not pull from the resources, other resources for that? That's my question is. Is there some reason that's endemic to the education system that prevents you as a university, for example, from pulling from outside resources when especially when they don't cost anything?

 

Phil Schuman:
There's a lot of things in there that I want to respond to. In that first part, yeah. For this year especially, it would make sense if you have the ability to get access to some online financial education platform, use that. I think this would be a great time to do it. The important thing though is and we learned this at the college level too, is you can't just provide financial education. You can't just throw a platform out there and say, “Go nuts.” You have to have some sort of context on the backend. If you're assigning it, you have to make sure as a teacher, that you understand the material as well and you're able to have a discussion around it after the students have gone through the online platform. I think that's really important.

 

Phil Schuman:
And what I'll say too is, there are a lot of banks, there are a lot of credit unions, there are a lot of institutions out there right now that are sponsoring school districts, who are sponsoring even states to help implement financial education in their schools. We are seeing more of that happen so more kids are getting access to it K through 12. But I think going back to your original point and sort of talking about your friend that was able to pull his son back and just give him this crash course in finances, this is sort of going back to where the income inequality comes into play here, where we've got a lot of families that don't have the ability to do something like that.

 

Phil Schuman:
And so, if their kids are able to get access to the stuff and they're at home, they still don't necessarily have somebody that's there to help put that stuff in the proper context because their parents are working a second shift, a third shift, something along those lines. This has been a really trying time for a lot of families because it just sort of throws up in the air what education can actually look like. And myself, I feel incredibly fortunate. My wife and I were lucky enough to both have jobs. We're both able to work from home. We have as good of a situation as one can possibly have and yet we're still struggling to figure out exactly how to educate our daughter on a regular basis.

 

Phil Schuman:
And you said, she walked in here as we started talking. And so, if that's the situation for us, I can only imagine how difficult it is for these families that are having to go on the front lines or whatever you want to say and work these jobs that just pull them away from their families, when really the family is what people need the most right now.

 

Tom Wheelwright:
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Tom Wheelwright:
Let's shift a little bit. I know one of the reasons that you started the financial education there at any Indiana University was the high student debt and we talked about high student debt for years. Student debt now is, as I understand it, higher than credit card debt. And to me, I can't even imagine that because I didn't have any student debt when I went to school. It wasn't that expensive. I literally, so I went to graduate school at the University of Texas and my tuition cost was $4 a semester hour.

 

Phil Schuman:
That's not bad. I'd take that.

 

Tom Wheelwright:
My total semester was about $200. That's how much it cost. Now I don't know any major university that's even in that realm anymore for in state tuition. And so how have you been dealing with that with your students when you talk about, okay, you're coming out of school and you were mentioning earlier that a lot of times that student debt actually grows after they leave school. First of all, how does that happen? And second of all, what are you doing to help them understand what to do about their student debt?

 

Phil Schuman:
How that happens, so sort of the topic we were talking about as it relates to the difference between white students that are graduating from college and then African-American and Black students that are graduating from college. I think the stat that's most interesting is that four years after graduation, the percentage of African-American or Black students who owe more than what their debt was originally worth, so four years after, is 48%, which is crazy. Almost one in two African-American or Black students, they have more money owed on their student debt than what they graduated with. Whereas that same stat is only 17% for whites.

 

Phil Schuman:
How does that happen? Well, it happens in a number of different ways. There are a lot of variables that come into play here. Again, it could go back to some of the systemic issues that we've got right now. And some of the reasons why we do have protests because there is some inequality within the system where people aren't getting access to jobs where they should have. If you were looking paper to paper, covering resumes to resumes, you'd be like, yeah, this person is qualified. And then for some reason it just doesn't pan out the way it should. That's one of the issues is that people aren't getting the jobs that really their degree says they should be getting.

 

Tom Wheelwright:
We were talking about, this show, we like to talk about solutions. What are some things that people can actually do? And a lot of our listeners are entrepreneurs. They have their own business and it sounds to me like one of the most important things we can do as entrepreneurs is that we make sure we hire based on skillset and not race, not anything else like that, but really make this. And I got to tell you, we've made that a very, very important practice, but it has to be the culture of your company. That you're really looking for the best people. We're always looking for the best people. I don't care where they come from. I don't care where they grew up. I don't care.

 

Tom Wheelwright:
What I want, we have a young woman from Serbia, speaks fluent Spanish, by the way. I never figured out why. And you know what? She's fantastic. Yeah, she has a little bit of an accent, but that's okay in her role. An accent's okay. Certainly that's something we can do is we can make sure that in our businesses and the dealings we have, that we're looking at at skillsets, we're looking at potential, we're not looking at anything other than that. I think that should go without saying. Unfortunately it doesn't go without saying and I think that's part of the issue.

 

Phil Schuman:
Well, it's sort of interesting because it's hard to argue with that point, but there's also something that comes into my head with that. Yeah, absolutely. You want the people that are best qualified. You want the best skillset, all of that kind of stuff. But at the same time, there's value in sort of diversity of perspective as well even if somebody is a little less qualified. And the way I think about this is if we have a basketball team and if you put the five best players in the NBA or something like that on the same team, it's not guaranteed success. You would think it would.

 

Tom Wheelwright:
I agree.

 

Phil Schuman:
But the problem is, if you put, I've got to not date myself here, but I'm just going to throw it out. But if you put Shaquille O'Neal, Tim Duncan, David Robinson, Patrick Ewing, and I need another Sen.

 

Tom Wheelwright:
Moses Malone.

 

Phil Schuman:
Moses Malone.

 

Tom Wheelwright:
Moses Malone.

 

Phil Schuman:
Okay. And then I'm going to throw in Bill Laimbeer as the sixth player, just because he's kinetic.

 

Tom Wheelwright:
There you go. There you go.

 

Phil Schuman:
But if you put those six guys or if you put those five guys in a starting lineup, that's not going to be a very successful team because they all have the sort of the same skill.

 

Tom Wheelwright:
All centers, yeah.

 

Phil Schuman:
But instead, if you got the equivalent of a point guard, a shooting guard, a power forward, that kind of stuff, all of a sudden your team is much more well rounded and all of their skills really combine together to create this one efficient team.

 

Tom Wheelwright:
I totally agree.

 

Phil Schuman:
And so I think that's really important in all of this is to say, “Yeah, we want to hire the best people that are out there, but we also want to hire the people that are going to make the most well rounded team. They're going to bring in skillsets from different areas.” That way we can really run.

 

Tom Wheelwright:
And their contribution isn't necessarily just their technical skills, but their contribution is a lot of other skills as well. There's no question. That's a very important part of business is you want to make sure that your team is well rounded, that your team, it's like I was talking to somebody before this call and we're talking about doing some kind of a partnership together. And what I want to know is what they did, because I don't want to partner with somebody who does what I do. That doesn't make any sense to me. I want somebody who's not the same as me. And I think that's a very important point here is that a lot of times what we ought to be looking for is people who aren't the same as us, because that brings a richness to the business that you wouldn't otherwise get. I think that's very important. All right, now we got a little off there. Back to student loans.

 

Phil Schuman:
I'm not avoiding. I'm not avoiding. I want to make sure I point that out.

 

Tom Wheelwright:
Okay. What are you doing with students? Let me have you explain this, what are you doing with students to help them with their student loans? Make sure those things get paid off and they're not a big drag on them for the next 20 years.

 

Phil Schuman:
Yeah. One of the big things we started when our program got started way back when, was we implemented something called a student debt letter, which is as boring as it sounds, it is just a communication piece that we send out to students that says, “Hey, here's how much you've borrowed up to this point in your academic career and here's what it'll look like if you graduate with this amount of debt, post-graduation in terms of monthly payments.” And the reason why we started doing that was because basically we surveyed students. They didn't know how much they had borrowed up to that point. They didn't know, in some cases that they had borrowed up to that point. Maybe their parents had done it and just not told them anything. And so basically what we were trying to do is let them know, “Hey, here's where things stand at the moment and do you want to continue to borrow at this rate? Do you want to sort of adjust things moving forward?”

 

Phil Schuman:
It was basically a way to start the conversation. And even before, if you're familiar with Richard Thaler's book on Nudge Theory, that's what this is, this is a nudge. It's not trying to tell students, “This is what you need to be doing.” But it's just to say, “Hey, what do you think? What do you want to do here?” And so, in a way, it's designed to be both proactive and in terms of making them think about how they're going to borrow in the future and also reactive so that they're like, oh my God, I have this much in debt. I've got to figure out what I'm going to do in order to not graduate with so much. And so that's sort of step one. And so we put that out there.

 

Phil Schuman:
Step two, it was building up this financial education program. Basically availing ourselves to students and saying, “Hey, if you want to talk about any financial topic, but specifically student debt, setting up sort of repayment.” Not telling them, or not signing them up for repayment plans, but talking to them about what strategies they can employ to get rid of that debt as fast as possible. We made ourselves available to that. We built some programming around it and basically just tried to attack it all different angles. Our university as well changed around some of our practices where we started offering students the ability to take more credit hours per semester at the same rate. If you come to IU and for this year, it's actually at our Bloomington campus, you can take basically 40 credit hours per year, per academic year, for the same price as you could 24. And so we're trying to incentivize students to take more classes at once.

 

Phil Schuman:
One of my favorite restaurants here in town, Village Deli, their slogan's, eat and get out. That's sort of what I want people to take with her approach to academics. It's like learn and get out as fast as you can. But we've seen really good success with this. Since our program started, we've had almost a 20% decrease in student borrowing since 2012. And that's about a little over a $126 million.

 

Tom Wheelwright:
Hey, if you like financial education the way I do, you're going to love Buck Joffrey's podcast. Buck's a friend of mine. He's a client of mine. He's a former board certified surgeon and he's turned into a real estate professional. He has this podcast that is geared towards high paid professionals. That's who he's geared towards. If you're a high paid professional, you're going, “Look, I'd like to do something different with my money than what I'm doing. I'd like to get financially educated. I'd like to take control of my money and my life and my taxes,” I would love to recommend Buck Joffrey's podcast, which is called Wealth Formula podcast with Buck Joffrey. I hope you join Buck on this adventure of a lifetime.

 

Tom Wheelwright:
Years ago, I did a class to a group of high school students on financial education. I just asked them, I said, “Let's list out all of the expenses you're going to have when you're not at home.” And we listed them out and said, “How much would this be?” And I just had them tell us. I just had them say, “Okay well, it's going to be this.” Well, how much do you spend here? How much do you spend here? Every one of them was like, they were spending like $30,000 a year. I said, “Okay, now let's add on taxes. Now let's add on these other things.” And I'm going, they had to come out. And this was 15 years ago. And they had come out with a 50 to $60,000 a year job just to break even. And that was without any student debt. And this was at a high school.

 

Tom Wheelwright:
I think a reality check, which is what I hear you doing. You're giving them a reality check. This is what's going on. And I think it's, I personally, I think that the increase in tuition at universities is frankly a shame. I'm sad to see that because like I was telling you earlier, it was $200 a semester for me to go to graduate school. $200 a semester. And now that won't even get you one hour even in state anywhere. And so, when you look at that and you go, “Wow, there's this inflation.” Now you got this debt. I think what it means is that we just have to do more and more financial education because otherwise what we do is we handcuff our students before they leave. We're putting a tax on our students is what we're doing. And we all know a tax is a drag on the system.

 

Tom Wheelwright:
Let me ask you this. Let's wrap up with this. What are some things you think that people can do, business owners, investors, just what can we do individually that would help solve these issues with our students and with others?

 

Phil Schuman:
Yeah. That's a really good question and I feel like if you solve that if you get the right answer to that, you're going to fix a lot of problems, but what can businesses do? I think one of the big things is just you have to be mindful of what the situation is right now and you have to make sure you are rewarding seems like the wrong word here, but that's the word I'm going to use here. Rewarding people for what they have. If they have the degrees, they have the credentials, we have to make sure we are paying people the appropriate amount. And we have to make sure we're paying people the same amount, regardless of whatever their background is. If they have the degree, there should be a pay associated with that and it should be reflective of what they've gone through. It should be reflective of probably of what they've paid as well.

 

Phil Schuman:
That's going to be really important. That said, I would also say pay shouldn't just be the only thing we should be concerned about. We also have to make sure that people are taken care of as it relates to benefits. We should be paying people the right amount but also we should be making sure that people have the appropriate amounts going into their retirement accounts. We talk to students that when they graduate, they should be trying to hit around 15% total contributions on a monthly basis. And right now the problem is, is that people are having to choose between funding retirement and paying off student loans. We need to figure out a way to get around that. And yes, that does mean we need to find a way to make, I'm not going to say higher education cheaper because I don't think that's going to happen, especially with COVID. I think that's going to be a difficult thing to do.

 

Phil Schuman:
But I think there are ways to make higher education more affordable and make it more accessible for people who want to come in. And that's something that we have to figure out. But then for employers too, I said, it's got to be the benefits side it's got to be the salary side. It's got to be making sure that we're allowing people the same opportunity to come in and get those jobs as well. From a financial education standpoint or from a financial wellness standpoint one of the big things that's starting to come out as well, are employers that are signing up for financial wellness benefits. And in some cases that's a specific thing. I think it was, I think PNC is one of the companies that's a student loan repayment benefit. That's one opportunity. Much of the same way that somebody would do a retirement contribution, employers are starting to do student debt contributions, but then also providing a financial wellness platform for their employees.

 

Phil Schuman:
A friend of mine does a great job. He runs a company that basically has a financial wellness platform for any employer that signs up, that all their employees get access to their financial wellness platform. But then they also have a dedicated phone line, email line where they get access to a one-on-one conversation with a financial advisor for free. And it's something that really can help them move their financial path forward and I think that's a really important thing.

 

Tom Wheelwright:
I like that whole discussion because I think financial education in the workplace is just as critical as financial education in the school system. And for example, we play a financial game with our employees on a regular basis. It's a game called Cashflow. It was created by Robert and Kim Kiyosaki and it's a very popular financial education game and it teaches basics of accounting, basics of investing, basics of money management and we do that with our clients. We actually do that with our staff on a regular basis because to me, the more successful our staff is from a financial literacy standpoint, the less pressure frankly, it puts on the business because it means that the employee is taking responsibility for their finances and they're not relying solely on the business to take care of them.

 

Tom Wheelwright:
There's nothing worse as a business owner, I will tell you, anytime an employee has serious financial struggles or serious personal struggles, it's going to reflect on the job. And it's going to be tough for them to do their job. Anything we can do and it's not like you say, it's not always just giving them more money. Sometimes it's just helping them understand, okay, let's talk about financial education. Let's talk about what you can do. Let's talk about building up a portfolio of whatever, whether it's a portfolio real estate or stocks or starting your own business. We've actually in my 25 years as an entrepreneur, we've launched over a 100 businesses with our employees. And I think that's, it's hard on a business because you turn over employees that way but at the same time, they're now financially secure and financially safe because they've got that.

 

Tom Wheelwright:
And it just seems to me like more we can do with the people around us, I'm not going to solve the school system issue. I'm not going to, that's not something I have the talents or skillsets to do or the knowledge to do. But can I solve the financial literacy of the people around me? Absolutely. I can contribute to that. To me, it seems like the more we can do from an education and financial literacy standpoint in our workplace, in our families, in our homes, the more successful we're going to be as a society. Would you agree with that?

 

Phil Schuman:
Yeah. I think focusing on what you can do within your local community, whether or not that's your family community, or your school community or your community, I think that's the right thing to do. Yeah, we're not going to be able to change things from a national perspective. But it's going to rely on each of us to do what we can within our own little worlds to kind of help build everybody up. But then again, that's why programs like us sort of exist. We can help fill in those gaps when the local communities aren't necessarily enough.

 

Phil Schuman:
And to your point, a few seconds ago about sort of the employment side of things, there is so much research out there that basically just says that employees who are stressed about their finances aren't nearly as productive because they're spending their time at work either stressing about their finances, actively dealing with their finances, all this kind of stuff. And employers lose a significant amount of money per year on employees that are financially stressed. Putting systems in place that are going to help them address that will actually improve their work productivity. In a way, you'd be stupid not to invest in something like that for your employees.

 

Tom Wheelwright:
No, I love that. Thank you so much. Phil, final words.

 

Phil Schuman:
I highly encourage people to obviously educate their kids, their students, themselves on personal finance, but really look to see what you can do to help out your communities with financial education. And also for parents out there, I think the big thing to remember is yes, the cost of college is pretty high right now. If you're thinking about going the public route of things, in-state is definitely cheaper than out-of-state so make sure what you're doing is you're looking to see what's going to be the best benefit for your student as it relates to college.

 

Phil Schuman:
Make decisions based on finances, not necessarily based on gut and heart, which is sort of a callous thing to say, but we've seen a lot of financial lives were ruined because people said, “We wanted to do everything we could to get our kid to go out of state.” And that is a tough thing to do. It's a tough thing to back out of. And the one comment that I hate hearing when it relates to paying for college is, “We'll figure it out.” That is the worst possible thing you can say. Have a plan so that you don't have to figure it out later.

 

Tom Wheelwright:
I love that. And I love the idea of working with your kids when they're young with the goal that they won't have to take on student debt at all. I think that is a real frankly, if you start when they're young, it's a realistic possibility. There's things that you can do to plan for their education so they don't have to take out student debt and I'm not talking about a 529 plan because no offense, but I hate 529 plans. I think they're the dumbest thing. I think they're the dumbest thing that's ever been proposed.

 

Phil Schuman:
Oh, you and I have a big disagreement then.

 

Tom Wheelwright:
We do. We do. We do. I know that because you're talking about 401(k)s and I hate 401(k)s. But for a lot of people, that's fine. If you don't have financial education a 401(k)'s where you ought to go. If you don't have financial education, a 529 plan's what you ought to do. But if you get financial education, there's so many more, so much better. There's so many better opportunities if you're willing to put the time in to get the financial education. What happens is that you end up with way more money available for your kids. You can get to the point where you don't have to worry about what school are you sending them to because you've already got that money set aside for them not earning a half percent interest or 1% interest or 2% interest, but money that's actually compounded, seriously compounded over the years when you get the right financial education.

 

Tom Wheelwright:
I'm happy that you're giving financial education. I think that's a start. I think there's different types of financial education and we need to constantly be looking at how do we improve the financial education? How do we increase the financial education? And I love what you said, Phil, is that where we do agree is certainly we agree that the more we can do with our local, our community. And our community right now may just be our little pod. It may just be our little bubble, that's our community. Or if we have an online community that we can work with, there are a lot of, like I said, there's a lot of financial education available online. And so that would be my encouragement is that I think as you and I agree, when we take this seriously, income inequality is a serious issue and it's a serious issue for everybody.

 

Tom Wheelwright:
It's not just a serious issue for those that are on the low end. It's also a serious issue for those on the high end because it causes disruption. It causes problems. I just think it's a really big issue and the more we can do to help, the more we can do within our own circle of influence, I think that the better off we're going to be. With that, I just want to thank you, Phil. Is there anything, any kind of resources or anything that you'd like to share with our listeners?

 

Phil Schuman:
Yeah, if people want to know more about what we're focused on at Indiana University, you can just go to moneysmarts.iu.edu to learn more about the types of programs we put in place, including the financial education platform, MoneySmarts U that we built a few years back. If you're interested in just learning more about what higher ed is doing in general, you can go to hefwa.org. That's the Higher Education Financial Wellness Alliance and that's the national organization we run. But yeah, I really appreciate the time, Tom.

 

Tom Wheelwright:
No, thank you, Phil. Thanks so much. And remember everyone that when we get more financial education ourselves and of course that's why you're listening or if we're teaching financial education, which is when we actually learn the most is when we teach, then what's always going to happen is we're always going to make way more money and pay way less tax. See you next time.

 

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