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4 min read

Personal finance lessons failing school children

Posted in: Research

    • Nearly all (87%) teachers say there is a significant gap between the finance skills taught in schools and those needed in the real world
    • Half (50%) say personal finance lessons at their school are only satisfactory or poor; only 9% say they are outstanding
    • 21 per cent of teachers say personal finance lessons at their school are just a tick box exercise
    • Consequently, nearly half (45%) think that pupils have unrealistic expectations about finance and what they can earn when they grow up

    Secondary schools are failing to equip teenagers with the financial capability they will need in the real world, according to research among teachers.

    The research, from financial services provider OneFamily, reveals that half (50%) of secondary school teachers rate the personal finance lessons delivered as part of their school’s personal, social, health and economic (PSHE) education as either satisfactory or poor. One in five (21%) say their school only does the minimum required to tick a box, while one in 10 (9%) say that the lessons are not fit for purpose.

    The vast majority of teachers (87%) say there is a significant gap between what is taught to children in schools and the skills needed as an adult.

    These views are borne out of the lack of financial understanding amongst teenagers. Two in five (38%) teachers say their teenage pupils don’t understand the difference between a credit card and a debit card, with some (16%) even saying their pupils do not know where money comes from. Overall, the majority (55%) of teachers believe there is not enough focus on preparing teens to manage their own finances.

    Nearly half (45%) think that most pupils have unrealistic expectations about personal finance and what they will earn, which is reflected in teenager views. Half say they expect to earn £35,000 by the age of 30, whereas realistically on average they will earn £11,000 less than this[i].

    With the recent introduction of new accountability measures[ii] adding more pressure on strained schools, more than a quarter (27%) of teachers say their school is not able to prioritise PSHE, which should offer vital ‘life lessons’ for pupils.

    Within the schools that are able to deliver personal finance lessons, many teachers question the relevance of the content. Two in five (41%) say that the resources available to teach teens about personal finance are out of date, while more than three-quarters (78%) say that teens need to learn from practice, rather than theory.

    Some teachers also worry that they might be letting down their pupils. One in 10 (13%) of those who have taught personal finance lessons in the last two years say they do not have the right skills and two in five (39%) teachers would like further training to help them deliver personal finance lessons.

    Although many teachers are concerned about their pupil’s personal finance abilities, three in five (63%) feel there is too much pressure on them to teach ‘life lessons’ and 84 per cent say parents should do more to teach their children about personal finance. To help, OneFamily has drawn up some tips for parents to help them, available here [Link].

    Steve Ferrari, Managing Director of Child Trust Funds at OneFamily, said:

    “It is crucial that children reach adulthood knowing the basics of personal finance, but at the moment, the quantity and quality of information provided in schools is hit and miss. Personal finance should be made a mandatory part of PSHE to help address this skills gap. In two years’ time, the first round of teenagers will be able to access their child trust funds – in many cases the first time they have had a windfall of money – and it is important that they think carefully about what they are going to do with the money, and not squander it.”

     

    [i] www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/articles/youngpeoplescareeraspirationsversusreality/2018-09-27
    [ii] Progress8 and Attainment8