The Best Living Standard
History and implementation
About fifteen years ago, the Cox School of Business started a summer business minor program that included a personal finance class. There was a recognition that financial knowledge was needed, and the summer offers fit well with the strategy to populate classrooms left vacant on our mostly traditional campus. My training was in insurance economics, and I taught risk management at Cox, but I possessed a Chartered Financial Consultant (ChFC) designation acquired during an earlier career and was interested in financial planning. Then, as now, the discipline of financial planning is not a curriculum offered at most universities and four-year colleges, and the vacuum has been filled by professional education programs, the College for Financial Planning and the CFP credential, and The American College, which offers the ChFC.
When I prepped to teach a course in personal finance, I started with a textbook search and didn’t find much suitable for a bachelor’s degree program. The existing content was too basic. You and I live in a world of practicing financial planners, investment advisors, and private wealth managers. How are they trained? Big hint: most know Harry Markowitz and learned about his intellectual contributions. Education centers on investments and the regulations surrounding them. But financial planning is broader than that.
Our book meets the need to help households (and their advisors) make effective decisions for the financial questions they confront. Investment choice is always important, and in later case studies, readers will understand how investment risk and return are woven into education planning, retirement planning, and annual budgeting.
Today: Achieving the highest lifetime living standard when making decisions is a common thread, and this excerpt provides a short history and offers an illustration of Irving Fisher’s original ideas with a primitive life-cycle model for Roxanne.
Excerpt:
