Financial education in schools: will the current proposals be effective?
Thursday, January 07, 2010
by: Lorraine Gallagher
London, U.K., 7th January, 2010: The government recently announced it wants to increase the level of personal finance education in schools as a means to educate the next generation to avoid the dangers of debt. All attempts to improve personal finance understanding in schools are welcome but the current approach which only adds small amounts of personal finance across a number of subjects lacks substance.
The decision to make PSHE (Personal, Social and Health Education) compulsory has been greeted as a welcome step to increase financial capability amongst young people but financial capability is only a small element of a subject that is unlikely to be taken seriously.
As Anne Kiem, Vice Principal at the ifs School of Finance, describes it:
“PSHE, as the name tells us, covers a range of areas of which personal finance is only one small component. As welcome as this inclusion is, we should not get carried away that cursory inclusion in non-examined subjects will improve the UK’s low levels of financial capability.”
There are other, proven methods for improving the knowledge, skills and behaviours of young people in managing their money. The ifs, an educational charity, is currently the only provider of Ofqual (Office of the Qualifications and Examinations Regulator) accredited GCSE, AS and A-level equivalent qualifications in personal finance.
Research has shown that standalone qualifications are more effective than teaching personal finance education across several subject areas. They provide a more coherent curriculum, a sharper focus on learning outcomes, are measurable and perhaps most critically, they change the way young people think about, spend and save money.
Anne Kiem concluded by saying:
“In the debate about the causes of the financial crisis, few commentators have given due attention to the deficiency in financial capability of consumers that also contributed to the development of the situation. There is no doubt that mismanagement of personal finances contributes to rising debt, poverty and social exclusion, all of which have serious knock on effects on the economy at large.
"We firmly believe that schools provide ideal environments to start shaping positive attitudes to money management but much more remains to be done to make a lasting impact”.
Notes to editors:
ifs School of Finance
The ifs School of Finance is a registered educational charity incorporated by Royal Charter. It has a remit to provide the financial services industry with a skilled, effective and competent workforce whilst also promoting a better understanding of finance amongst consumers.
The ifs is the only educational body with a specific focus on finance that has the power to award its own degrees. Its formal qualifications range from GCSE and A Level equivalents for the 14–19 age group, to Degree and Masters programmes for financial professionals. The ifs also offers professional development, competence maintenance and executive education programmes through its alumni membership services.
Please ensure the letters “ifs” appear only in lower case to avoid confusion with the Institute for Fiscal Studies (often referred to as the “ifs”) with whom we have no association.
For further information, please contact Lorraine Gallagher (Media Relations Manager at the ifs School of Finance) on 0207 444 7103 or e-mail lgallagher@ifslearning.ac.uk
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