MSE News: Inquiry into financial education in schools launched

If you'd have shown me this graph at age 15, I'd have a hell of a lot more security than I do now.

http://www.fool.co.uk/10steps/step1.aspx

Good news.

Just hope the education is 'principles' based and not bogged down in financial jargon and complexity that most people with never use or need.

If kids now that living within their means, only borrowing to finance assets (including a good degree) and making sure they make provision for their retirement, we would have much more sustainable economic growth and no demand for inappropriate financial products.

R.

I don't disagree with what Martin want's to achieve with his petition. But, I do strongly believe it is exciting us all to give a sense of priority to something that is nice to have, whilst we ignore the real disaster going on in education: Thousands of children leave school every year unable to make their way in adult life: one in five of our teenagers leave school unable to read and write properly or do basic sums.

Of course it would be ideal for every child to have basic financial skills. But it is utterly wrong to take time, money and focus out of the school curriculum whilst one in five of our teenagers leaves school without being able to the skills to understand things they read or even do basic percentage calculations.That's not a "nice to have" - its a basic responsibility that we should all give our children the tools they need to survive.

And no, I am not advocating a return to the three Rs alone.
But a child that can't calculate a percentage will never understand what an APR is. What's more, can you tell me that APR will be the way we measure interest in five years time? Information goes out of date - the ability to think never does.

Ok, If one out of five is functionally illiterate and innumerate, then four out of five pupils might find financial education useful. But, that's no reason not to put all the focus, energy and resource we can into ensuring that basic literacy and numeracy is not just a right, but is a truth - something we guarantee to every child. Especially as (see below) fact-based education is becoming more and more useless to every child.

It's not about money, either. the most precious resource in education is time, and I can't see how anyone can justify taking time and focus, and specially training teachers to provide something that will only help some and will still leave thousands incapable of functioning in the adult world.

Lack of basic skills is not just a waste: It's a criminal waste: we are tolerating a society where one in five of our young adults can't hold down jobs and can't function effectively with the basics of life. Thousands of these wind up in prison. This is one of the places our rioters come from.

Financial education is a (slightly) useful luxury: Petitioning for it whilst we can't make a fifth of our children fit for anything other than failure is a monstrous mistake. What's more, it's attracting so much attention it is getting the government off the hook about the need to give children the basic life skills that will change society for the better, for us all.

It may be too late for financial education to be useful anyway. Or in fact, any fact-based education that covers topics that are changing and developing. I believe what Martin wants, "to ensure every child in the country gets a basic understanding of personal finance & consumer rights before leaving school", is not achievable - personal finance products and consumer rights are changing all the time. Personal finance is capable of generating all the press coverage it does and has as many "experts' as it has, precisely because it is complex, demanding and changing.

If you've not seen the presentation "Shift happens" then I suggest you take five minutes and 19 seconds to do so: So much information is being produced in the world today, and so many things are changing, that most non-academic graduates will be finding that their degrees are out of date by the time they graduate. What hope for anyone who is taught about financial products and consumer rights in 2011 but doesn't use that information until 2014, or later?

We need basic skills. If we are to add anything to the learning burden, then it's the skills needed to assess information in any aspect of life and to make judgments based on information that our children need. With that they can handle anything - they'll have the best chance of personal success and the ability to be discerning citizens too.

Compulsory financial education sounds great. A panacea even. Literacy and numeracy for all is much harder and much more necessary. And, if you really want a life skill that will make a difference don't lower your horizon to financial education alone. Teach children to think and to use information wisely and critically.