There’s not much we can now do for Ms. Gould except to buy her books (which I will do when I go to England this summer).
But I’d like to think there’s something we can do to prevent this sort of thing from happening again (and by “this sort of thing” I mean the phenomenon of so many bright people doing dumb financial things).
Everyone who goes to high school should be required to take a class where they learn some finance. Everyone should come out of that class knowing that interest-only loans are very risky and that house prices do not always go up. They should understand the different kinds of mortgages and they should understand how credit cards work and they should understand the stock market and they should understand risk generally.
For example, when my wife and I bought our house, my wife had never even seen an amortization table. Once I showed it to her, she realized we would have a terrible time if we bought a house at the price for which we were approved. We bought one at about 2/3 that price and were able to pay it off quickly. Financially, it’s the best thing we ever did.
Our high-school graduates should know this sort of thing.
