When I was growing up, my parents were exceptionally frugal.  They acquired nothing until we needed it, and they acquired it in the least-costly way possible.  We received items others did not want and made good use of them.  I remember when a cousin of mine gave us a suit he was going to throw away because it had a tear in it.  My mother had the suit rewoven by one of her sisters, and I wore it for several more years.

We borrowed things and used them.  My dad used to repair televisions in his spare time.  Aside from getting a little bit of income, our family had the benefit of not having to fight over who watched what program because the televisions would stay with us a few extra days after they were repaired, usually because the person who had requested the repair could not get over to pick the television up until the weekend.

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In the July 11 New York Times there was an article on the serious issue of state and local government pension liability, and the debate about the extent to which the Government Accounting Standards Board should require governments to reflect pension and retiree health liabilities on their income statements.

I was pleased to see this issue get coverage because it is one of the biggest issues of our time. We are an aging society, and like every other developed country, we are facing the dual challenge of meeting our commitments to the elderly, while at the same time being able to meet commitments to the rest of our population. Before we can address the dual challenge, we need honesty and transparency as to what the commitments to our elderly populations are going to cost us. (more…)

In the April 9 Wall Street Journal, there is a front-page story about the impact of sub-prime lending on ordinary citizens. Featured in the story is a 74-year-old self-employed tailor who put her entire $55,000 life savings into a high-interest-rate notes issued by a Philadelphia lender called American Business Financial Services. When the firm went bankrupt, she and others lost their entire life savings. The blog entitled The Importance of Being Financially Literate reinforces the fact that Americans lack financial knowledge even in the most basic savings and investment decisions.

While the story is a tragedy, it brings to mind the urgency of focusing on teaching all Americans financial literacy. The National Urban League and its affiliates have specific financial literacy programs, specifically focused on first-time home buyers. Operation HOPE, headed by the very impressive John Bryant, is specifically focused on broad-based financial literacy. These are great programs, and they provide individuals with good nuts-and-bolts tools. Other notable mentions on behalf of the National Urban League in partnership with Honda amid the turbulent economic climate include their offering of personal financial management classes. The acclaimed “Know Your Money Program” seeks to provide economic empowerment and financial literacy to those individuals in communities seeking to change the attitudes about money and money-management. The program is highlighted in this Honda Blog post. (more…)