As the FT reports this morning:
Last summer I asked the Institute of Chartered Accountants in England and Wales to invest in financial education for young people. The suggestion was that:
Around £100 million to be spent over ten years to provide education for young people in the financial skills that they will need when they either leave home or enter the world of work, including:
- The basics of tax and how it impacts them.
- Types of employment and self-employment
- How banking works.
- Saving, borrowing, interest rates and related issues.
- Renting and mortgages.
- How to avoid being conned and online security.
- How and when to ask for help, and who from.
Issues like budgeting would have been part of this at a more basic level because none of the rest makes sense without it.
The ICAEW said there was no demand for this; others were doing it, and they did not have the resources. All those claims were obviously wrong.
They still have £148 million of revenues from fines paid by firms that failed the public over the last decade sitting on their balance sheet, and as far as we currently know, they are all available to use for this purpose, which would advance the reputation of accounting considerably and, therefore, be within the scope of its public purpose as defined by its Royal Charter.
They did not, however, want to undertake that public role or accept that responsibility to society.
Now do you see why I wanted to quit? How can you want to be a member of an organisation whose business model is to enrich itself and its members at cost to society at large because of the failure of some of those members to undertake their work to a proper professional standard that meets public need?
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Well corruption rife in the UK and a mostly dumbed down electorate failing to recognise it or feeling helpless to do anything about it. Not a lot of advancement over the centuries!
When I ask my current 6th form to set out what they want from education, the top two are finance and political knowledge.
Back in the 1990s the 6th form I was Dep Head of (300 students when I left) ran Wednesday morning ‘carousel’ sessions where they acquired First aid certs, Basic Food hygiene Cert, survival cookery and Budgeting/Finance – all prepping them for life/university. this was dropped as league tables and OFSTED began to narrow education.
And that was a backwards step – although I undertsand why it happened
The Money Saving Expert website provides a lot of the information needed to find your way around the financial jungle, whatever your age. Financial education for young people going off to uni or into the workplace is a good idea in theory, but there is always the question of who will deliver it. And studies show that people don’t retain the information for very long anyway, so it’s usefulness is questionable.
Whatever your level of knowledge you can still fall prey to a “get rich quick” scheme or a plausible salesman. The financial services industry is always looking for new ways to add complexity, obscure high charges or otherwise pull the wool over our eyes. Buy now, pay later schemes are one of the current examples. They should be regulated but government pushed that back and it’s not clear if or when that will happen.
If we had clear simple products and rules there would be much less need for financial education. The focus in financial regulation has always been on the sale of products, not on the products themselves. Because of a belief that competition will ensure a fair outcome. Customers must shop around. But of course, there is an information asymmetry that means customers are always at a disadvantage. I can’t see how education alone will solve that problem.
I find your logic a little baffling
A large part of everything taught is forgotten quite quickly unless repeated
That is why this has to be reinforced throughout education, unless you think none of that worthwhile
My niece and my oldest son (23 & 22) were fascinating
My niece grasped money before she started school while my oldest referred to ‘money for tickets’ and that was as far as it went.
But both are now very on top of managing their finances.
So it needs to be a subject touched on all through education up to and beyond 18