If you grew up in the U.S., you probably spent hours learning about the Pythagorean theorem, the Boston Tea Party, and how to dissect a frog. But how much time did you actually spend learning about things like managing credit, saving for retirement, or avoiding debt traps?
For most of us, the answer is not much. Sure, maybe you had a short personal finance unit buried somewhere in high school, but it was probably so basic (or boring) that it didn’t stick. Meanwhile, you graduated into a world where you were expected to figure it all out—student loans, credit scores, mortgages—on your own.
So let’s talk about three of the most important money lessons they should have taught us in school. If you’re already in the thick of adulthood, don’t worry—it’s never too late to learn.
Your Credit Score Is a Big Deal (and You Should Know How It Works)
At some point, you’ll probably want to buy a house, lease a car, or even just open a credit card with good rewards. When that time comes, your credit score will either open doors for you—or slam them shut.
The crazy thing is, many people don’t even know what a credit score is until they realize theirs isn’t great. So let’s break it down:
Your credit score is basically your financial report card, and it’s based on five main factors:
- Payment history (Are you paying bills on time?)
- Credit utilization (How much of your available credit are you using?)
- Length of credit history (How long have you had credit accounts?)
- New credit inquiries (Are you opening too many new accounts at once?)
- Credit mix (Do you have different types of credit, like credit cards and loans?)
One of the biggest myths about credit is that you should avoid credit cards to stay out of debt. But actually, responsible credit card use—like paying your balance in full every month—can build your score and make life a lot easier down the road. The trick is treating a credit card like a debit card: Never spend money you don’t actually have.
If your credit score isn’t great, don’t panic! Paying bills on time, keeping credit card balances low, and avoiding unnecessary hard inquiries can help you improve it over time.
Budgeting Isn’t About Deprivation—It’s About Freedom
A lot of people think of budgeting like a financial diet—restrictive, frustrating, and no fun at all. But a good budget isn’t about cutting out everything you love; it’s about making sure your money is working for you.
The key is to stop thinking of a budget as a punishment and start seeing it as a roadmap to financial freedom. Want to take an amazing vacation next year? Buy a home? Retire early? That’s where budgeting comes in.
One of the best and simplest methods is the 50/30/20 rule:
- 50% for needs (Rent, groceries, utilities, insurance)
- 30% for wants (Dining out, shopping, entertainment)
- 20% for savings and debt repayment (Retirement, emergency fund, credit card payments)
If 50/30/20 doesn’t fit your situation perfectly, adjust it! The real goal is to be intentional with your money. That way, you’re not stuck wondering where it all went at the end of the month.
And here’s a big one: Always pay yourself first. That means before you spend on anything else, set aside money for savings. Automating this process (like setting up direct transfers to a savings account) makes it even easier. Future you will thank you.
Investing Isn’t Just for Rich People—Start Now
For a long time, investing had this intimidating, “Wall Street only” kind of vibe. But in reality, the earlier you start investing—even with small amounts—the better off you’ll be.
Why? Two words: compound interest.
Think of compound interest like a snowball rolling down a hill. The longer it rolls, the bigger it gets. The same goes for your investments. The earlier you start, the more time your money has to grow.
Let’s put it into perspective. Say you invest just $100 a month starting at age 25. If your investments earn an average return of 8% per year, you could have over $350,000 by the time you’re 65. If you wait until 35 to start? That drops to around $150,000. That’s a huge difference, all because of time.
If you’re new to investing, you don’t need to dive into stock-picking or day trading. A simple, low-cost index fund (like an S&P 500 ETF) is a great way to start. Many 401(k) plans and IRAs offer these options, making it easy to set up automated contributions and let your money grow over time.
And here’s a crucial tip: Don’t let short-term market swings scare you. The stock market naturally goes up and down, but historically, it always trends upward over the long run. The worst thing you can do is panic and sell when prices drop. Stay the course, and let time do the heavy lifting.
It’s frustrating that schools don’t teach these essential money lessons, but the good news is, you can take control of your financial education at any time. Understanding credit, budgeting with purpose, and investing early can put you miles ahead of where most people start.
No matter where you are in life, the best time to start improving your financial future is right now. So take that first step—your future self will be so glad you did.