Subscribe to our free fortnightly newsletter and stay ahead with the latest news in independent education

Holding the purse strings

How much do pupils really know about personal finances? Not enough, according to ifs University College's recent report

Posted by Stephanie Broad | October 05, 2015 | Law, finance, HR

The Young Persons’ Money Index 2015 is a study of over 2,000 children between 15 and 18, in full-time education in the UK.

Alison Pask, Vice Principal of ifs University College, says in the report: “Originally commissioned in the early part of 2014 by financial education specialist ifs University College, the first Young Persons’ Money Index revealed a concerning, if not unexpected picture of financial literacy among UK teenagers.

Where it existed, financial education was delivered in schools and colleges inconsistently, in a piecemeal fashion and unfortunately, was largely ineffective. 

“The college firmly believes that every teenager should receive consistent and high quality learning experiences and should leave school for the next stages of their lives with the confidence and ability to manage their own personal finances. Today’s students are tomorrow’s consumers and we owe it to them to understand their hopes and concerns for their futures.” 

The report focuses on four areas: financial education, expectations, financial behavior and effects of the education. The main theme emerging from the research is that, despite 97 percent of respondents considering themselves ‘financially active’, fewer GCSE students say they learn about personal finance in school compared to 2014’s results. Many claim to learn about money from their parents, relying on them to manage bank accounts and spending. This can be a good influence if the right habits are taught – but if unrealistic expectations or limits are set, this could have an effect in later life. 

So, how can a school play its part in ensuring the financial awareness of its’ students? Some subjects already contribute to this, with 37 percent of students reporting that they learn through Economics classes and 36 percent through Maths. In post-16 education, students learn about finances in Economics and PSHE (26 percent in each). 

Kathy Crewe-Read, Head of Wolverhampton Grammar School, says: "Clearly this report is telling us nothing new in that many students are still lacking the skills and knowledge they deserve about how to understand their financial world. At Wolverhampton Grammar School, we expect all students will have to manage their own finances to some extent and as would-be voters we want our young people to be informed enough to be able to hold the economic and fiscal policy of the government to account. 

“Aspects of finance are incorporated into both the curriculum from year seven, extracurricular clubs like debating and economic societies are available to get students to discuss what economics means to them and many of our sixth form take an optional qualification from the Institute of Financial Studies, aimed at increasing their confidence and competence to plan and manage their finances as adults. Schools shouldn't just teach that which is stipulated by government, but should look to how they can creatively incorporate financial debate, discussion and understanding into co-curricular activities too."

Key research findings 

  • 28% of 17-18 year olds receive formal financial education prior to starting university or work
  • 56% feel they have enough knowledge to manage their own money
  • Students earn an average of £111.28 per month, mainly from part-time jobs

The report concludes that students need more skills around personal finance to support and give them confidence in the next stage of their lives. Suggestions include teaching how to manage bank accounts and bills, or more consistent Citizenship teaching. 

Read the report: http://www.ifslearning.ac.uk/financial-capability/young-persons'-money-index 

Do you think schools should do more to educate students about personal finance or is it the responsibility of parents? Tell us at Stephanie.broad@wildfirecomms.co.uk 

 

Image designed by Freepik

Subscribe to our free fortnightly newsletter and stay ahead with the latest news in independent education

Related stories

Tomorrow's leaders are ready and waiting

5 lessons in developing a new uniform

A trip of a lifetime

How Kukri creates one-of-a-kind sports kit

Lead the field with Stevensons XXV

Autumn/Winter '17 issue of Independent School Sport is here!

Brookwood on how catering can play a vital role in boarding

Keeping it in-house

The best of both worlds with Cambridge IGCSE

How to get the most out of new recruits

Market place - view all

Student COM

UK supplier, designer and installer of network cabling solutions. ...

Listen technologies

Listen Technologies brings power and clarity to the sounds that enr...

RM Education

Supplier of software, services and systems to UK education

Tamlite Lighting

Tamlite Lighting was founded in 1967 at Telford in Shropshire and t...

Nationwide

Award winning online banking: whether it's current accounts, credit...

Sodexo

Our positioning in the services industry is original and unique. It...