IVA News Articles
Financial Education
By Jennifer Howgate
Tens of thousands of adults are uneducated in personal finance issues causing loss in money through purchasing unsuitable products. Financial education will develop people’s economic understanding and give them a foundation to manage their money.
In detail financial education should help people:
- Engage confidently in financial issues
- Prepare economic planning and savings.
- Find suitable financial opportunities.
- Understand whether taking out an overdraft or credit limit is right for them.
- Make a detailed assessment of information and advice received from financial institutions
- Control asset collection, which has been shown to make a real difference in people’s life-choices
Scott McKinven, project manager at Hyde, one of 14 housing associations behind community development finance institution Change, says it is imperative to make people stop and think before they dive into an ocean filled with loan sharks. A credit Union in Sheffield for example has opened a program aimed to educate children on financial matters. By getting the children involved their parents automatically become educated as well.
Alice Rogers, coordinator of the London-based Services against Financial Exclusion (Safe), collaborates with ten organisations, to help educate the public and assist them make knowledgeable choices about their money. Safe is also working towards making financial education part of every college’s curriculum.
Young Adults personal Finances
By Jennifer Howgate
Personal finance courses for students aged 17-18yrs old have been offered at schools for over five years; almost 100schools are offering a range of Money management courses, with more than 2,000 over the UK currently studying the certificate.
Aimed at teenagers 14-16yrs old the newly introduced Personal finance courses will hopefully teach the next generations to handle their money responsibly preventing future debts. Courses aimed at the younger students cover topics as, loans, currency, ATM’s and car insurances. The older students can take courses such as: “Introduction to Money”,” Money Management”,” Personal Financial Encounters" and "Money Management Solutions".
However 16% of primary and 11% of secondary schools in the UK do not offer financial education. The reasons included:
- Not enough school time and staff time
- Prioritising other subjects
- Not appropriate for children of this age
- Lack of knowledge and awareness on finances
Some schools claimed financial education to be purely a parental responsibility. And unfortunately only 43% of the schools not offering financial education intend to introduce it in the future.
A research conducted by the FSA showed that a group of your adults 15-19yrs old showed very little interest in financial matters. The study also showed:
- 81% of 16-19 year olds hold a personal bank account, but only 39% have a savings account.
- Young adults will spend copious amounts of time and energy trying to find the best mobile phone deal, and spend close to no time on finding the best financial service.
- 88% of 15-19 year-olds said their parents were an important influence on their money related decisions. Parents may have given the ‘right’ advice and information but it was their overall behaviour and relationship to money that influenced their children's financial habits.
- Despite the supposed availability of financial education in schools 40% rated their school money management coverage to be extremely poor.
- The majority of young adults associate banks and finances with something boring. Saying they will have more interest when they are 25-30yrs old.
- Many feel that if the financial institution would provide an interesting and beneficial approach for young people, their interest in money management may increase. Some banks offer deals such as free mobile phone contracts, rail passes and discount shopping vouchers to persuade students to open accounts with them.
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