|Alternative Funding Network|
Without education, we're stupid
58% of all children leave school or college without having had any financial education.
These young adults face important decisions - paying bills, whether or not to have a credit card, taking on student loans, renting somewhere to live, maybe even one day starting a business - and they're doing it without the benefit of any financial education whatsoever.
This is Grade A* stupid - for them, and for the economy.
Here's what you need to know
- Fewer female students (36 per cent) receive financial education than boys (45 per cent)
- Older students (17-18) are significantly less likely to receive financial education than younger students (15-16), at a time when they will soon be required to make independent financial decisions about going to university or starting their careers
- 80 per cent of students name their parents or family as their prime source of financial understanding
- Teenagers generally view their mothers as being “better” with money than their fathers
- Half of UK teenagers feel they have enough knowledge to manage their own money, but 61 per cent say they have money worries
- The majority of teenagers think they will earn far more than the national average by the time they are 30
This sobering research is from the London Institute of Banking and Finance’s Young Person’s Money Index.
Here's the positive note… and the sting in the tail
Financial Education GCSEs and A levels have been available since 2006 - with over 250,000 kids having gained a qualification. In fact, in this academic year, 26,000 kids are in the programme. And in 2014 these qualifications became part of the national curriculum - but, typically, it's bunged in with Maths and Citizenship, rather than being stand-alone.
Even worse schools and colleges don't have to teach it at all unless they have maintained status - so this exempts all the academies and all the private schools.
So, what can we do?
Here are three ideas:
- Agitate - if you want your children to be financially savvy rather than totally naïve, find out if your kids’ school or college offers these qualifications - and if not, suggest to them that it's pretty damn important
- Consider LiFE - this is an e-learning suite of programmes which will allow students to experience financial education on a ‘learning by doing’ basis
- Win prizes - ask your kids to think about signing up for competitions in the Institute’s Student Zone
Why do it?
Because we need our young people to be smart.
We need them to be able to manage their money; to be able to pay (and not over pay) bills; to choose the best savings and credit options; to be able to get - and keep - a roof over their heads.
And we need them to be smart entrepreneurs, running great businesses.
Dr Louise Beaumont is Vice Chair - Open Bank Working Group. 'The Open Banking Working Group'is a collective of banking, open data and FinTech professionals, formed at the request of the UK Government.
Louise has over twenty years experience in growing companies - from initial spark, to operationalisation, results delivered, and value created. Having previously worked for organisations such as GLI Finance, Siemens, Hewlett Packard, Microsoft, and Capgemini. Louise has advised key UK government departments and units on FinTech and AltFin including; HM Treasury, British Business Bank, Government Office for Science, Cabinet Office, UK Trade & Industry, Department for Business, Innovation & Skills, and Number 10 Downing Street's Policy Unit.