Poor people don't have much money so they don't even need to make many financial decisions beyond very basic ones that anyone with common sense can do. Unfortunately, the reason many poor people are poor is because they lack common sense.
That's ridiculous, and kind of a classist shitty thing to say. There's nothing "common sense" about the value of compounding interest, and in fact exponential growth is exactly opposed to how human brains and untrained intuition work. That impacts credit cards, it impacts their own investments (large or small), it impacts use of paydal loans, it impacts car loans, it impacts buying on installments. Unless someone sits you down and shows you how to do the math (or use Excel), it's not at all intuitive how much money you're losing by not paying off your credit cards each month. When you're deluged in advertising from paydal loan places assuring you they're a good bet, advertising from the unhealthiest foods pointing out how cheap and tasty they are, advertising from scam artists and exploitative credit card companies and banks offering subprime mortgages with proves lies about how easy they are to pay off - it's damned hard to "just use common sense."
This isn't limited to poor people either, as much as you'd like to believe they're only poor because they deserve it. 90+% of NFL players are bankrupt within years of retiring. Tons of middle class people have no idea about this stuff either, they're just less affected by it because they can survive while not using "common sense" since they're not at the margins already.
http://www.nytimes.com/2013/10/06/b...racy-beyond-the-classroom.html?pagewanted=all
Anyone with even a basic understanding of compound interest, inflation and diversification should know that the answers to these questions are “more than,” “less than” and “false.” Yet
in a survey of Americans over age 50 conducted by the economists Annamaria Lusardi of George Washington University and Olivia S. Mitchell of the Wharton School of the University of Pennsylvania, only a third could answer all three questions correctly.
I took a class on personal finance my last year of college and I learned an enormous amount, and I come from a solidly upper-middle-class background with parents who are generally good with money, plus I've taken advanced mathematics. It's completely unreasonable to expect everyone to just know this stuff.
The whole economy collapsed in 2008 by the supposedly most financially literate and intelligent part of our society and somehow you think a few hours at school is going to teach kids, many who would have failed the marshmallow test, to spend their money wisely and prudently while resisting the temptation to buy things they don't need with money they don't have?
The greatest problem this country has is immorality and amorality of which its greatest sin is greed.
No, it probably won't fix things completely or immediately, but it will surely at least point them in a better direction. If you told people the importance of 1) pay off your credit cards every month if at all possible, 2) don't use payday loans, they're a huge scam, 3) compound interest is a big fucking deal, and maybe 4) some basics on buying big-ticket items like cars (different types of loans structures, when it's better to pay in cash, etc.), that would put people a LONG way in the right direction. Point them to trustworthy and respected institutions like Vanguard for investing and they'd be even better off once they start making some headway.