Teaching financial literacy

  • Teaching financial literacy

Schools have a duty to teach young people ‘financial literacy’ – Alison Pask advises two teachers unsure of the best way to fulfil it

Q I work in a medium-sized academy in a rural location. The student voice is taken seriously in the school – and recently, our curriculum committee has expressed a very clear desire for much more focused teaching of ‘practical finance’ at KS4. The main concerns of our young people appear to be ‘the dangers of credit’, ‘how to budget’, and ‘using the internet to make money’. Are these the right areas we should be covering with this age group, and is there anything else we should include when planning a programme of study around ‘financial literacy’?

A Practical finance is a good description of what students need at this key stage. I would refrain from referring to credit as ‘dangerous‘ as not all credit is. Yes, payday loan sites and loan sharks are clearly dangerous and should be avoided, but we must also ensure that pupils understand that to progress in life they will need a good credit rating which can be achieved by understanding the difference between good debt and bad debt.

Also, whilst making money on the internet is perfectly possible I think the main issue is staying financially safe whilst online. We must remember that teenagers are not exempt from financial crime with 25 per cent having received phishing emails or texts meaning that helping them understand how to stay safe has never been more important.

However, there are also a number of other things that must be addressed, as the inclusion of financial education in the National Curriculum does require schools to deliver a programme that also covers the following:

  • How to manage money – borrowing, saving and budgeting
  • How to compare financial products
  • How to use information and advice to make decisions
  • How we make a contribution to our society
  • Longer term financial planning to ensure provision for a financially healthy future.

This subject can be delivered across the curriculum and be part of a whole school initiative. Taught well, you will be creating a generation of confident and competent financial consumers who are prepared and able to deal with an unpredictable financial future.

Q I am head of Y7 at a small, CofE secondary school, and have recently been asked to put together a programme of ‘enrichment days’ for our new starters – one every half-term, covering as broad a range of topics as possible. I would like to include some kind of ‘business enterprise experience’ as a part of this – but my head teacher is worried that parents might not feel it fits comfortably with the school’s ethos. Do you have any suggestions for ways I could contextualise such a learning opportunity in order to emphasise its benefits beyond building understanding about the generation of profit?

A Delivering a programme which includes a business enterprise experience is an important initiative and should form part of the school’s lifelong learning programme. Students should be provided with an understanding of how businesses manage money and the relationship between personal money management and business money management.

A programme that introduces students to some of the following concepts should be considered:

Public finance and the economy, including how these relate to:

  • social, political and cultural factors
  • political institutions and processes
  • impacts on individuals, businesses and society.

Financial management, including:

  • personal financial planning
  • understand how a business manages its money.

Employability, enterprise and business, including how these relate to:

  • students own employability
  • benefits to, and consequences for, businesses, individuals and society.

Through executing a programme which covers these concepts, students will also be exposed to a great deal of wider learning that can help them succeed in other ways such as:

  • understanding the skills for success
  • developing the ability to identify and understand information from a number of sources
  • using appropriate tools to manage a personal budget and being able to apply these concepts to a business enterprise
  • impoving financial literacy
  • developing numeracy skills, including the ability to manipulate financial and other numerical data.

Ultimately, parents should understand that their children are facing an unpredictable future where many of the jobs they will do, do not currently exist. By running programmes in business enterprise and financial education, students will most definitely be better prepared for life in modern Britain.

ABOUT THE AUTHOR

Alison Pask is the Vice-Principal and Head of Financial Capability at ifs University College – the only dedicated Financial Capability qualification providers for 14-19 year olds. To hear more from Alison follow her on twitter, @alison_pask

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