Primary school children should receive age-appropriate lessons in financial education to encourage positive attitudes towards budgeting and savings, according to new research published today.
In an age of contactless payments and in-app purchases, the report ‘Financial Education in Schools: Two Years On – Job Done?’ commissioned by the All-Party Parliamentary Group on the same topic for Young People (supported by Young Enterprise), makes eight key recommendations that aim to ensure schools equip young people with the skills to manage their money well.
Among the proposals, drawn up with the help of experts from the University of Birmingham’s Centre on Household Assets and Savings Management (CHASM) is a call for:
- Statutory financial education for primary school children and a better focus on real-life contexts in Mathematics and Citizenship lessons at secondary school.
- Ofsted Inspections be extended to the provision of financial knowledge and skills.
- Schools to use Pupil Premium funding to strengthen their focus on financial skills.
- The Department of Education to embed financial education in the new Initial Teacher Training framework.
- Financial services organisations to offer “significant” funding for financial education initiatives in schools.
- The UK to participate in the OECD’s evaluation of financial literacy in 2018.
Following the introduction of statutory education on finances in English secondary schools in 2014, the six-month cross-party inquiry, chaired by Suella Fernandes MP, examined the current impact and effectiveness of such education.
The report stated: “Understanding how to manage money well remains a key life skill that is required for all aspects of adult life… Yet despite this, the UK still faces a significant financial capability challenge, with young people affected in particular.”
The report called for education on finances to “start younger” and recognise the role that primary schools can, and should, play in familiarising children with money concepts in an age-appropriate manner.
“Financial education should not be a ‘postcode lottery’, with some students left out simply due to the school they attend, which is why we recommend that statutory financial education is introduced at primary level,” the report stated.
Professor Andy Lymer, Director of CHASM and Professor of Accounting and Taxation at the University of Birmingham, said: “Getting the right foundations in financial education is more important for young people today than it has ever been. Evaluation of what works when educating children about finances is critical to aiding further enhancement of this provision. CHASM is delighted to have supported the development of this report as it fits closely with a key aim of the Research Centre in supporting all aspects of financial education development.”