MSE News: Compulsory financial education moves one step closer

kimnpat

Thank goodness Martin sold out to Moneysupermarket - you may need them to re-hire you if they teach students how to manage their finances more effectively. What will you do when those who subscribe to your email's realise that they can't really get paid for checking their credit report, etc?

Although, if what they say about kids leaving school unable to read properly is true, your job may still be safe for a while yet.

Seriously though. I'm sorry if I seem pernicious, but I don't see any major benefits from this. In my opinion, a better way forward would be to teach people how to be responsible for their own actions. Joe Public didn't get into financial difficulties because he didn't understand that if he has a disposable income £200 he cannot afford to borrow money with repayments of £210. I know of people that took loans with companies like Provident and said before they signed: "If I can't afford it they can have a Pound a week and there's nothing they can do." Whilst that attitude is still prevalent, which it is, the same people will get into the same difficulties again.

Furthermore, the reason I attacked your site is because of the irresponsible way you peddle credit cards. Whilst you advise people that struggle to make repayments on a credit card to transfer what they owe to another credit card that is 0% for 6 months, you cannot possibly expect people to believe that you are helping them. Whilst you advertise mortgages without informing people properly that they could could face double the repayments outlined when interest rates increase, it is unfair that you purport to be helping them.

Finally, I do not understand how this will prevent another credit crunch. Regulation is what will prevent another crash. Rather than telling people the best way to get credit and maintain it in order to get more credit, maybe time would be better spent curtailing the greed of those in the financial sector.

magpiecottage

The flaw in this plan is that, according to FOS, teachers are unable to recognise that a projected maturity value on an endowment illustration with a lower value than the mortgage amount means there might be a shortfall.

If they are too thick even to understand that there is no chance they will be able to teach anything about finance.

bowlhead99

magpiecottage wrote: »

The flaw in this plan is that, according to FOS, teachers are unable to recognise that a projected maturity value on an endowment illustration with a lower value than the mortgage amount means there might be a shortfall.

I don't know much about FOS but I presume their stance is to err on the side of caution and treat retail customers as if they are idiots unless they have a relevant qualification. Which is great for average consumers, because if the FOS has to look after the lowest common denominator they can afford to be lazy and not bother to read things. Or they can in fact fully read things and know exactly what they are getting into but if it turns out their decision was wrong in hindsight they can play dumb and weasel out of it at the service provider's expense.

The billions paid out for PPI mis-selling for example will contribute to higher costs for banking services going forward (or higher/lower rates on loans/savings) and we can be pretty certain that not every single last pound paid out was fully deserved by the individual claiming it.

Of course, FOS upholding more complaints is great for you, as those in the financial services industry have more to fear from the regulator and accordingly have greater demand for compliance consultancy services resulting in more work at higher price than would otherwise be the case. But I digress...

If they are too thick even to understand that there is no chance they will be able to teach anything about finance.

Presumably someone teaching GSCE Business Studies or A Level Economics would be perfectly able to show up to the citizenship class and wax lyrical about interest rates and the certainties of death and taxes. Certainly a maths teacher should be able to explain compound interest. A teacher of music, geography, art, PE: perhaps financial eduction does not fit in so well with their skill set. No doubt they would be better prepared if they'd had some formal education on it in their own formative years.

Personally I'm dead against financial education because once the average person understands these relatively simple concepts, my own professional qualifications are slightly devalued; also there will be greater demand for the best products and services which will push costs up, whereas at present a lot of people are content with crap products which subsidise the ones that I buy...:cool:

cimfimay

The big issue about Financial Education is that, like all subjects which are subject to our emotions and past experiences, it's not a simple case of doing one thing or the other. Have probably learned that from the evolution of sex ed at school(thoughI do sometimes wonder what we have actually learned...)
I have worked in the voluntary and community sector for over twenty years, and am currently working for a credit union. In my time working in hostels, in community groups and currently doing some research into VCS attitudes to debt and financial inclusion, it has become evident that just as teaching children and young people to cook disappeared from the curriculum and is now being dragged back, so financial emotional literacy needs to brought into the classroom again. and I do mean financial emotional literacy, because money is about emotions and identiy as well as maths.

When I was a kid, I envied the nonGCE kids who were being taught to work out how much a carpet for a room 9 ft x 12ft would cost at £2.00 a sq yd (yes I AM that old) or working out compound interest on loans, whilst I was working out how long a ladder I would need to scale a wall 10ft high, because we had to do modern maths for University. When I worked in hostels, I had to help residents work out their budgets, helping them understand that the doorstep lender was charging them too much interest on the £30 they had borrowed, or that taxis cost a lot more than buses to travel. now everyone seems to do modern maths.

These days I work with organisations who need help to help their service users understand that the answer, when asked, "do you want a lovely new kitchen/car/games console?" should actually be "no" , that there is no such thing as free money. But it we do not at least try to get in across when people are young, we will find it so much harder to help the adults. It is not going to be easy, but we have to start. And we have to start NOW

moneysavingboffin

I have been watching this very closely and I have some interesting points. I love MSE and Martin Lewis is a great campaigner.

However, I love to play devils advocate so I thought I would point out the following for discussion (and would love it if someone could prove me wrong).

1. Martin Lewis was not happy about the poor press MSE got. I got a feeling from his blog post that he wanted more coverage for himself and the site for getting finance education into schools.

2. It's interesting that Martin gave a huge donation £100k to the organisation that was getting all the pres for this breakthrough (Pfeg).

3. He is unwilling to join with other sites (that are a similar commercial level to MSE not including charities etc) who share the same goal as himself for introducing financial education (as he would love the plaudits for MSE entirely)

4. I hope that MSE is not included in the syllabus. It starts to get dangerous when a money making entity is introduced into schools in one way or another on such a mass scale. It's getting dangerous when we start to mix MSE with parliament (especially with moneysupermarket having such a large steak now).

I am suspecting this will be deleted but just wanted some healthy debate.

ps. I am just questioning. As mentioned I think that financial education in schools is excellent and I would be happy if it was introduced in any way.

I have just noticed (with the student finance too) that MSE do not like to partner with people who are happy to support!!

happyinflorida

I was very happy about this until I found out that it is the banks (who are totally untrustworthy IMO) that are going into schools to do the "educating" - this is not going to be good.

I have complained about this to my MP who said he's also not happy but there isn't any other choice?!

If I'd known it was going to be done by crooks I would never have signed the petition in the first place.

welshkatie

Whilst I am delighted regarding the success in hopefully achieving compulsory financial education in schools, this would only apply in ENGLAND.

With devolved Governments in Cardiff, Edinburgh and Stornaway responsible for managing Education AND setting the curriculum in Wales, Scotland and Northern Ireland respectively, this is only a partial success.

Please can the campaign be extended across the UK?

In addition, can Martin and the moneysavingexpert.com team remember that many areas that Government is responsible for such as education, the NHS, care home fees, free prescriptions (Wales), free bus passes etc are devolved matters and therefore VARY in different areas of the UK. There seems to be an overly England centric bent to the website and weekly email - it would be useful to clarify whether stories apply to England only, England and Wales or across the UK.

It would also be good to pick up on areas that apply just to the devolved nations e.g. it was the Welsh Government that first introduced free bus passes for people ages over 60, and again Wales which has free prescriptions for all (not that I necessarily agree with this!)

Rant over...!!

P.S I'm not a Welsh nationalist...just want an understanding that often things are different in different areas of the UK!!

:wave:

coachwise

Whilst I welcome the news I have a few caveats.
PSE is widely regarded as a "doss" so its effectiveness may be lessened.
Many non-maths teachers have great problems with percentages.
Are teachers so whiter than white that they can manage their debts successfully?
My wife was a teacher member of the Pfeg group locally and there was a preponderance of high street banks involved-heaven forfend that this should continue!
Will students connect with this as a topic? I well remember doing a life skills unit when I was a maths teacher. It was for year 11 students as a change from the exam preparation. The topic was working out/checking gas and electricity bills and one student asked why we had to do this. I suggested it might help in his adult life . His retort was "someone else will do it for me!"

showstoppa

Can anyone offer some advice on how to become a financial educator, what degree would you need? Maths, Business, both or more. It's def something I would like to look into..

Many thanks