Have you heard the news? Iceland is on the brink of bankruptcy. Apparently it’s the latest casualty in the global economic crisis. I can’t say that I’m shocked — after all, my Grandpappy taught me two important lessons about money:

1) Never lend money to a one-eyed drifter; and 

2) Never depend on Bjork to provide your entire gross national product. 

I kid — my Grandpappy taught me absolutely nothing about money, and neither did my parents. It seems to have been a common mistake in their generation. My own generation (Gen-X) is known for many things (our poor work ethic, our laziness, our inexplicable attraction to Ethan Hawke), but mostly, we’re known for our sense of entitlement. We want new cars, new houses and fancy vacations, and we want them yesterday. As a result, we use credit cards and choose to buy homes we can’t afford. By “we,” I mean the rest of my generation. I’m perfect, of course. 

Okay, maybe not. Confession time: I’m 35 years old, and I’ve been in credit card debt since I was a wee lass of 18. I remember the day clearly: I was buying my college textbooks, and a man on the street corner was taking applications for VISA cards. I hesitated and thought to myself, “Well, I really don’t need a credit card, but it does come with a free drink cooler… plus, it’s got a bitchin’ picture of the football stadium on the front. Sign me up!” 

And I’m not the only idiot out there — just watch the “Can I Afford It?” segment on Suze Orman’s popular financial show for five minutes. The typical call goes something like this:

Suze: Hi there! What do you want to buy?

Caller: Hi Suze! I’ve always wanted a Williams-Sonoma, diamond-encrusted potato peeler. It costs $10,000, but it is BEAUTIFUL, Suze!

Suze: Wowee, sister, that’s a lot of money! But I’m not here to judge, just show me the money!

Caller: Well, I’m 38 years old, and I make $300/month. I have $25,000 in credit card debt, and $12.42 in savings. What do you think, Suze? Can I afford it?

Suze usually screams, “DENIED!” at this point, and I really can’t blame her. Yet I also can’t help but think to myself, “Wow. I’ll bet that makes really good potatoes. I wonder if Williams-Sonoma offers 12 months same as cash.”

Like every other American (and Icelanderan), I’m feeling the pinch of the recession, and I’ve resolved to cut costs and pay down my credit cards. I also realize I need to take it one step further, because I’ve done very little to educate my children about money. My kids, who are 8, 6 and 5, currently keep their money on their desks in my old mixing bowls. They have no savings accounts, and they think food and toys are magically provided by elves. Clearly, I need to step up and teach them about working hard and saving up for the future. Otherwise, they’ll be facing the same situation in twenty years. 

It’s not too late to instruct my kids about fiscal responsibility. First, though, I have to educate myself and lead by example. Thank goodness Suze comes on in an hour.