/ Money

Will financial education strengthen the UK’s future?

An owl teacher standing at a blackboard teaching maths

A new draft curriculum was published yesterday which could make personal finance education compulsory in schools. But will a better financial education help the next generation dodge debt and mis-selling?

Call me a geek, but I think it’s great that finance is finally going to be taught in schools across all of the UK. Finance is already part of the curriculum in Scotland, Wales and Northern Ireland.

And as long as there aren’t significant changes to the draft curriculum that was published yesterday, it will start being taught as part of maths and citizenship lessons in England from September 2014.

Solid financial foundations

Financial products aren’t always difficult to understand. Yet without a solid grounding in the basics, it can be hard to know the right questions to ask about financial products before buying them.

One survey done on behalf of a charity pfeg – the personal finance education group – found that a whopping 96% of 18-19 year olds with credit cards had never compared their rate to check they were getting the best deal. Only 2% of them even knew what the APR on their credit card was.

While some people might be surprised by these statistics, I think it shows how necessary financial education is in our schools. Equipping young people with the confidence to ask the right questions about their money and financial products could make a huge difference to their futures and the future of our banks.

Education for the nation

Better financial education could lead to more people budgeting effectively, and make them less likely to get caught in a spiral of unmanageable debt. It could help more people to think about whether or not they’re getting a good deal on their loans, savings or even current accounts, encouraging more customers to switch providers.

Do you think a proper financial education will make a difference to the next generation of spenders? Who taught you what everything you know about your finances?


You’ve said it! Many of these conversations show how many people are genuinely ignorant of the facts of financial life – whether loans, credit cards, mortgages, working out energy bills and so on, as well as the way financial institutions and companies work (or should, at least!). These should all be taught so the pitfalls can be avoided. I wasn’t, like most people, formally taught – I learnt from my parents to some extent, but then the hard way by having to do it. I think I started with a responsible attitude to money because I had little, which helped me to be critical of financial products.

richard says:
9 February 2013

I taught budgeting at my slum school to the non exam classes in the 1960s – Then Thatcher BANNED it – It should only be taught if the subject is part of the Maths exam – otherwise it will be ignored by the children. Passing exams are far more important to children.


I support anything that will help make children better prepared for life. What concerns me most is the fact that so many people live their lives on credit, when they should be saving and spending only when they have enough money, which will save a fortune in interest charges. You don’t need to know anything about credit card interest charges other than the fact that they are all extortionate and the balance must be cleared each month to avoid a continuous drain on your finances.

A major problem is that university students are forced into debt because successive governments have pushed so many people into higher education and cannot afford to support them properly.


Understanding the basics of personal finances will at least give young people the opportunity to tell good from bad. The problem with debit and credit cards is that they encourage impulse spending – you don’t need the cash in your wallet. But used properly they are extremely convenient, and essential for on-line transactions. The key is to use a credit card properly – pay off in full monthly.

We all mostly have to live in debt to be able to purchase a house – understanding the range of loans and financial consequences can only be helpful.

As for university students – yes, we have opened up too many places in poor-standard institutions and courses that devalue a degree, and probably lead too many to think it will give them assured employment. Not so. They need to weigh up the prospects of employment and the financial gain against the cost.


The need to avoid debt is fairly easy to understand but I wonder how well school kids would grasp the complexities of house purchase, which is likely to be some years in the future for most of them. In addition to understanding loans there is the need to consider both additional and unforeseen costs of house ownership, the risks associated with inability to meet payments, possible negative equity and the fact that having a house restricts employment opportunity to the local area.

richard says:
10 February 2013

Sorry most of your points were discussed in my non exam slum classes – and WERE understood – somehow I get an impression you never taught slum children with inadequate parents – but the amount of time to give a good working understanding is far too long and complex to be extra curricular – it needs to be integral to the exam. I taught it for 7 years until Thatcher introduced league tables and National Curriculum and banned it..


Its the goal of schools, to prepare young people, for the challenges that they will encounter when they become adults. For many years, schools have taught the structure of our currency system, but since the introduction of plastic cards, such as debit and credit cards, there is a need to understand debit, credit, interest rates, bank fees, sales tax, loan agreements etc.
We handle money either by cash or plastic, almost every day, and the household budget has always been an important part of our daily lives. A better understanding of financial products and how to handle money, along with advice on how to avoid traps that cause unwanted debt should be mandatory in schools.

Examples of GCSE Personal finance test.
Note..Some of the questions are not very clear with their wording.



As you say, some of the questions could be presented better. I suppose it is worth children learning about simple and compound interest, though comparing APR is usually enough.