Financial education


I’m working on some projects about teaching finance in schools at the moment (which is why the posts have been a bit rare recently). I’m trying to put together a pilot programme for schools as well as some supporting material such as workbooks and a book (like Taming the Pound) but focussed around children and aimed at parents and teachers.


One thing I did was contact a journalist to see if I could get some concise questions to answer to try to get across how important this is.


Here’s the result.


Should financial education become a compulsory part of the school curriculum?

Yes, teachers want it, parents want it, students need it. But it needs to be integrated intelligently. If it’s another “you must do this pointless subject” it risks being another Latin that dies out in schools, or like the conventional study of Shakespeare that so often puts students off rather than catching their interest.


– Are teachers well enough equipped to deliver financial education to the adults of tomorrow?


No. If “Over two thirds (70%) of UK adults* have admitted to having debt problems” it doesn’t sound as if most adults know much about how to handle their money, and as “15% of teachers also admitted that they lack expertise in the area of financial education”# it seems clear that teachers are not exceptional in having their own finances under control or really understanding how to teach it. “Do as I say, not do as I do is all very well”, but assuming that the teacher is one of the 85% who think they know how to teach it, but one of the 70% who can’t do it themselves, is that good enough?

*Research by Opinion matters, carried out online between 7/2/2012 and 10/2/2012 questioning 1,510 UK adult respondents

#Survey of 258 secondary school teachers, conducted in December 2011 and January 2012 by Opinium Research


Should real life experiences be used in lessons so classes are more relevant to the modern world? E.g. interest rates/APR/mobile phone contracts/mortgages.

Yes, there’s plenty of evidence from Occupational Psychology and business generally that the greater the “fidelity” of the simulation (i.e. the closer to real life) the greater the learning, and that applies to children just as much as to adults learning a new role. With thought, and cooperation between teachers, finance professionals and psychologists, it also makes it easier to integrate the learning. For example, areas such as maths or ICT etc. easy to integrate , but with thought, history, geography or any other area can incorporate principles that are important for personal finance.


Can teaching children to think logically about why they want something have more influence on their money management skills in future?

Yes. Any good teacher, coach or psychologist can tell you that why is a more powerful question than how.


How to understand the theoretical background to the money supply and the national debt are important if you want a career in economics, but they have very little relevance for most people and where is the motivation to learn them? They are like Latin, it’s a subject that seems abstract and pointless. And assuming current adults know, that knowledge has not been helpful in terms of avoiding national or more important, personal, debt.


How to get the best mobile phone deal, how to understand APR etc. have more relevance to the individual, but again, did that knowledge help this generation of adults – not if 70% are in debt and the economy in a double-dip recession. It might be useful, but like Shakespeare, if it is taught the wrong way, it bores most people.


If the focus is on “why”, we get a different result. Questions such as, why do you want your own house or why do you want to download music, open up different areas. They allow discussions of the value of experiences against possessions, the necessity of choice (you can’t buy everything), the desirability of credit in certain circumstances, the issues of balancing the repayment of debt in future with having pleasure now.


So the “why” questions force people to face issues such as their priorities in life and the role of welfare and charity (which might integrate well into citizenship and religious education, areas that teachers feel students see as not relevant) and provide a motivation to learn important skills such as how (and why, and when) to use a comparison website, why it is important to know the APR on a loan and what the consequences of different rates are. If people in general (not just students), reflected on why they wanted what they wanted, and why aspects such as credit and debt were important to them, they would have a motivation to learn how to handle them. Without that motivation, it is just more boring stuff to learn, like pensions – everybody says they’ll check it up “another time”, because it is complicated, but actually it is because it is boring. But everybody, particularly children, learns interesting material that allows them to do things they want, like how to use a smart phone or social media – those are just as complicated, but if you want them,( so you have a strong “why”), you easily learn how.


The way to get decent financial education to everybody, starting with schools, is to ask “why” questions, to invite personal answers to those questions which makes for personal involvement and interest in learning about them.




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