Financial Education has entered the curriculum – but will it be enough?

“It’s a national disgrace that in the 20 years since introducing student loans, we’ve educated our youth into debt when they go to university, but never about debt”, says an e-petition to the government – one which has gathered 118,875 signatures.

Now, I’m not sure I would go far as to say that the lack of financial education in the school curriculum is a “national disgrace”, but the petitioners do have a point. Young people are growing up in an increasingly complex financial world – phone contracts, tuition fees and credit cards are quickly becoming everyday obstacles in the life of the teenager.

And it’s clearly a problem. 96% of British teens say that they worry about money on a daily basis, and no wonder: according to the OECD, in Britain 52% of teenagers will be in debt by the time they are 17!

Furthermore, apparently two-thirds of all people in the UK feel too confused to make the right choices about their money.

People. Not just children… Imagine how they feel!

Thankfully, there are signs of progress in the right direction. Initiatives such as pfeg, RedSTART and MyBnk are providing school children with informative, hands-on education about money: how to get it, how to keep it and how to grow it. And whilst these organisations are clearly doing a sterling job at engaging minds and ambitions, there is simply not scope for enough school children to be reached.

Here is where the government has stepped in: financial education is making its way into the school curriculum this month to much approval. In ‘maintained’ schools (those that follow the national curriculum), youngsters (5-14-year-olds) will learn financial literacy as part of maths classes, and 11-16s will be taught financial education on a cross-curricular basis, grounded primarily in maths and citizenship lessons.

There are natural limitations to this initiative. Only around 50% of schools in the UK will be obliged to follow the government curriculum – academies and private schools will not. There is potentially a risk of overcrowding an already packed school Citizenship curriculum, not leaving room for more than a few hours per term of financial education. So the question is, can adding financial education to the school curriculum deliver the desired outcome: can it make young people feel confident about managing their financial future?

The concerns are legitimate, but this is an early stage in the development of this initiative. Plus, they do not take into account the wider context of the push to increase financial literacy in the UK. RedSTART, MyBnk and others will grow more and more important in helping those schools and academies that are not bound to the government curriculum to establish their own financial education programs – although their resources are limited, the increasing importance of financial education will hopefully lead to an increase in awareness of and investment in them. Vitally, they take young people away from the classroom, into a world in which they can see the real importance of making good financial choices.

This is what is most important about the curriculum change: rather than just adding another subject to be studied in school for yet another exam, people should be shown the impact that their financial knowledge and decisions will have on their future – something that is just as valuable as any qualification. Schools may only be able to dedicate a few hours per term to this topic, but what we have found at RedSTART is that this is all that is needed to give young people the enthusiasm to take control of their own futures.

Tom Pilcher
Keir Macdonald