2+2=5? Why financial literacy should be taught in schools
by Natasha Christou Digital Marketing ConsultantMoney makes the
world go round, and it’s at the centre of our day-to-day lives for a variety of
reasons. A 2018 study found that three quarters of Britons were worried about
their finances, and further research concluded that over half of UK adults are
concerned that their mental health is suffering in relation to money worries.
It’s really is a matter of education, as young adults often feel that they were
not taught enough about money and budgeting during their years in education.
So, what’s the current situation and how can we improve on teaching young
people how to manage their finances? We take a look, with some help from
Business Rescue Expert, company liquidation specialists.
The millennial challenge
Millennials have brought a host of gaps in the teaching of finance
to the surface, and countless studies have concluded that when it comes to
money, this generation haven’t been taught adequate lessons. Millennials’
spending patterns stand in stark contrast to their predecessors; they’re keen
to splash out on experiences and don’t often take to the idea of big commitment
purchases seriously — for example, houses. Millennial spending habits signify
the disparity of their knowledge and attitude towards budgeting — research has
found that 60% of these youngsters said they are willing to spend more than
£3.11 on a single cup of coffee, while only 29% of baby boomers would splurge
for caffeine. A lack of financial literacy in education has undoubtedly played
a role in this, with many young people under the illusion that simply earning a
lot of money means that you’ll never be in any debt, along with a general
unwillingness when it comes to making sacrifices for the sake of budgeting. One survey found that 42% of teenagers said that
they wanted their parents to talk more about finances, and a staggeringly low
32% said that they knew how credit card fees and interest worked. Teenage years
are pivotal points for learning, so why is financial literacy being left out?
Revised curriculums
Finances are
complex and teaching them can require a lot of technicality and practical
examples in order to make any sense. Lessons in finance differ from core
subjects like English and Science, as they provide life skills which, if not
learned, will be detrimental as kids grow older and enter adult life. One UK primary school created its own bank, to combat ‘below average’ financial literacy learning.
Despite financial literacy being introduced to the national curriculum in
England in 2014, not everyone believes that school is the place for financial
education. Some believe the duty should be on parents to teach their children
the real value of money and how to approach it. It’s worth noting that in
private schools, faith schools, and academies, it isn’t a compulsory part of
the curriculum, so many youngsters would still miss out on these lessons. A lot
of schools who do incorporate it into the school day compartmentalize it into
general ‘citizenship’ lessons, but it’s arguable whether enough emphasis is
placed on it here.
The benefits of teaching financial literacy
The areas of
financial literacy currently covered under the national curriculum include
savings and investments, pensions, mortgages, insurance, and financial
products. It’s still a relatively recent introduction to schools, so not all
teachers may feel confident in teaching it yet, due to the specialised, complex
nature of the topics. There is also the matter of religious differences in the
approach to and teaching of these finance lessons. Followers of the Islamic
faith are prohibited from using any form of compound interest. This relates to
things like conventional mortgages, student loans and car loans, all of which
are commonplace in many other cultures.
For this reason,
making financial literacy universal, understandable, and an essential part of
learning can be difficult. Maths might seem like an obvious place to drop
lessons of finance in amongst existing content, but debate is rife as to
whether subjects like trigonometry are still deserving for a place on exam
papers, when finance lessons could take their place and provide long-lasting
life skills.
While there is
undoubtedly an absence and lack of depth in financial literacy, these lessons
could become more popular in the future. These skills will prove invaluable for
youngsters as they progress through life, and they could eventually counteract
the stereotype of a financially irresponsible or illiterate millennials.
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Created on Aug 2nd 2019 10:02. Viewed 618 times.