From September this year, children aged 11 to 16 in England will see financial education embedded into both maths and “citizenship” education. Personal finance is already taught in schools in Wales, Scotland and Northern Ireland.
There has been many campaigners, for example Martin Lewis, founder of MoneySavingExpert, who suggests that “we desperately need to break the cycle of financial illiteracy in the UK - one of the causes of our current economic crisis and a huge contributor to continued mis-selling epidemics.” While a 2012 Panelbase survey conducted by pfeg and the National Children’s Bureau found that 43% of seven to sixteen-year-olds worried about money, with nearly one in eight having borrowed money that they could not afford to repay.
The financial crisis has brought a shift in financial responsibility away from government and big businesses to individuals, for example, in pensions, tuition fees, and the increasing use of private healthcare - putting all this responsibility on the shoulders of the public creates the need to have an education system that explains to them at a young age how basic financial concepts work.
However, there are no compulsory lessons beyond the age of 16 - a time at which pupils might be facing their first tough financial decisions. Furthermore, free schools and academies are exempt from teaching financial education, if they so wish.
At the same time, teachers are being asked to teach financial training, but they themselves not have been taught it nor may understand it fully themselves. Hence schools will need further training or outside help.
Some charities, such as MyBnk, which offers classroom education in schools, are reaping the rewards of the demand for financial education, with an estimated reach of 40,000 young people this coming school year. At schools in more affluent areas they can teach children the value of money - they may own an iPad, laptop, TV and mobile, and not understand how much they all cost nor how easy they are to obtain.
These classes may also help children to understand public finances as well as their own personal finances - this will hopefully empower them with the knowledge to make their own decisions and to have more say in how the economy works. For example, a trainer with MyBnk, Rhiannon Colvin, has stated that here is an entrenched view that the government spends its money on “benefit scroungers” when in fact most money goes on schools, hospitals and pensions. These classes will hopefully change children's attitude to money - if all goes to plan we'll see the benefits over the next few years.
However, some are not yet happy with the curriculum such as the ifs school of finance, a financial education charity, which has called to make financial education a subject in its own right.