If we were taught about money from an early age, we could face the banks on an equal footing when we get older. So why don’t schools put personal finance on the curriculum?
The three Rs have always been the bedrock of a solid education.
However, with the threat of a double-dip recession looming and millions of us in debt, surely now is the time to add a P and an F to those Rs and start teaching personal finance at school.
In the past month, two separate pieces of research have shown that not only do many of us think personal finance is too complex, but the vast majority of us want to see it as a subject on the curriculum.
A report from financial advice charity the Money Advice Trust revealed that only 38% of respondents were confident in taking financial decisions. Meanwhile, another survey stated that 71% say a lack of basic personal finance understanding is to blame for debt.
Personal finance can be complex
Why do we take it for granted that people know that spending what they don’t have will ultimately catch up with them? If everyone knew that – and stuck to it – none of us would be in debt.
From interest rates to exit fees and structured products to with-profits funds, the world of money isn’t simple. Financial education in schools would create a mentality of questioning which would lead to consumers making more capable decisions about their money.
Children need financial confidence
If children were taught early enough that money doesn’t grow on trees and that it doesn’t belong inside a china pig, then banks and building societies would have to treat their customers as equals.
Indeed, banks may see financial education as advantageous, as more financially-literate consumers may well buy more products more confidently. I think that’s what you call a ‘win-win’ situation.
So when your six-year-old comes home talking about investment banks rather than In The Night Garden or learns their ABC at the same time as the FTSE, don’t be alarmed, be impressed.
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