financial education - resistance by banks

lemonjelly

http://news.bbc.co.uk/1/hi/business/8366443.stm

Wow. Announced yesterday in the queens speech. 24 hours later, the banks are already challenging this.

Now, if I ever saw an MSE call to arms, this is it!

Pobby's trying to get my head around it thread, and many others have meandered around this as an issue. Many of us on here have argued that financial literacy in the UK really isn't good. Indeed I work in the advice sector, & 2000-2003 there were schems from funders desperate for you to include financial literacy as a project.

In my view, it has fallen off the radar somewhat. To enshrine the fact that it needs to improve is, in principle, a good idea in my view.

So, without being too cynical, why do we think that the banks are intent on scuppering it already?

dunstonh

So, without being too cynical, why do we think that the banks are intent on scuppering it already?

They are not the only ones. IFAs are not happy about it either as we have to pay towards it as well. Another bloody levy for things that have little to do with us.

I have no problem with the educating side and think its a good idea. The funding of it is wrong though

Do accountants have to pay for the adverts on the telly to get your tax return done?

Do mechanics pay for campaigns for people to get their MOTs done?
Did doctors have to put their hand in their pockets to fund the "how to sneeze" campaign from the NHS recently?

I have no problem with the need to educate but passing the cost to the small independent firms who actually do a very good job of educating people is just passing the buck for a Govt that has failed to get it right itself and is playing on the bad feeling that a lot of people have to certain parts of the financial sector.

lemonjelly

dunstonh wrote: »

They are not the only ones. IFAs are not happy about it either as we have to pay towards it as well. Another bloody levy for things that have little to do with us.

I have no problem with the educating side and think its a good idea.

Do accountants have to pay for the adverts on the telly to get your tax return done?

Do mechanics pay for campaigns for people to get their MOTs done?
Did doctors have to put their hand in their pockets to fund the "how to sneeze" campaign from the NHS recently?

I have no problem with the need to educate but passing the cost to the small independent firms who actually do a very good job of educating people is just passing the buck for a Govt that has failed to get it right itself and is playing on the bad feeling that a lot of people have to certain parts of the financial sector.

Interesting that dunstonh. Thanks for contributing. Was unaware of the impact on IFA's, & hadn't considered it.

Perhaps another soundbite piece of legislation?

PasturesNew

People won't learn anything from it. It'll be expensive and pointless.

Better to charge £100 the first time you try to take out a loan for a course and a short exam. If you don't get 100% you can't have the loan.

Another £100 for a mortgage test.

Pobby

Dreary economics at school taught us nothing. It would be about 1960 when a cousin of mine bought a house, £2,000 I think was paid. Everything was on then hire purchase including a car. It wasn`t long before they lost everything. So mismanagement isn`t a new thing.

I think it would be a good thing to teach money management at school but I don`t see why dunstonh should pay. It certainly would be more useful than some of the stuff kids are taught.

I would say though it would be s difficult subject. How does anyone really plan these days when the goal posts are shifted around every 5 minutes.

ses6jwg

Surely teaching financial responsibility should be the parents job, not the kids?

Oh no wait, they've just lost their 2nd home in Benidorm they bought in 2007 and now the bailiffs are at the door demanding the keys to the BMW they bought "on that brilliant finance" deal to keep up the Jones' next door.

StevieJ

Another useless Quango

fc123

Funny this should come up.
We have been sorting out daughters post GCSE 'what to do next' course etc and, for some reason, she has been looking at the houses in our local paper and selecting the type of house she would like to live in one day...then, how much do I have to earn to buy this (it's usually a million pounder +).
I think she had a careers talk and it prompted her to decide what she wanted out of life (it's all swishy glamour at the moment) and how to get it (as we aren't wealthy parents who can give it to her).

So I told her X 4 salary and a deposit and she then went off and googled jobs for 250k pa....couldn't understand the description on most....and so it went on.
I then tried to explain interest rates and the like and she just didn't get it (I don't think I explained it well) but managing a budget I went through ours with her and she was shocked at all the bills she had no idea about.

Compound interest is all they need to teach teens. Do some loan examples on different rates like This telly is 1k, if you repay over 24 months, how much do you pay in the end?...that type of thing. Might lose Brighthouse a load of custoners in the future though.

Outrageous that IFA's are expected to fund it....sounds like a stealth tax to me. Surely the maths dept could prep a simple lesson that relates to teens

fc123

ses6jwg wrote: »

Surely teaching financial responsibility should be the parents job, not the kids?

Oh no wait, they've just lost their 2nd home in Benidorm they bought in 2007 and now the bailiffs are at the door demanding the keys to the BMW they bought "on that brilliant finance" deal to keep up the Jones' next door.

You know what? I have tried with 22 yr old son and he's driving us nuts at the moment. From the first day he had an allowance (aged 8) , he would spend the lot..always...we did the piggy banks, the savings accounts all of it but he is useless with money....must be our fault I guess.

We now take the view that he will have to learn at some point and we can't bail him out if he runs out of cash and his car needs fixing.

He won't do CC though as he did debt collection one summer and it put him off for life but we are subsidising him now so he can clear his O/D...and guess what? It's still to the max after 4 months..and he earns plenty to clear it.
OH and I have given it a deadline though.....

ses6jwg

fc123 wrote: »

You know what? I have tried with 22 yr old son and he's driving us nuts at the moment. From the first day he had an allowance (aged 8) , he would spend the lot..always...we did the piggy banks, the savings accounts all of it but he is useless with money....must be our fault I guess.

We now take the view that he will have to learn at some point and we can't bail him out if he runs out of cash and his car needs fixing.

He won't do CC though as he did debt collection one summer and it put him off for life but we are subsidising him now so he can clear his O/D...and guess what? It's still to the max after 4 months..and he earns plenty to clear it.
OH and I have given it a deadline though.....

Don't worry, wasn't having a pop at all my parents, I am one myself.

My parents have given me a complete free run over the money they saved for me since I was 17. I used a couple of grand to change my car, and the rest I have moved to the best deals and added to.

On the other hand, my sister is 18 and still has no access - I think its probably because she thinks nothing of doing a £350 clothes shop in one session.

abaxas

Maybe if we enforced labour if you dont pay it back? Others are forced to pay for it, why not the person who took out the debt.

Obviously, it would be impossible to reclaim all debts, but 2 years of hard labour and total loss of ALL posessions and assets would sort it out.