A new report from the London Institute of Banking and Finance (LIBF) shows that the majority of young people in the UK do not receive any financial education in school or college, despite the subject now being compulsory.
The research, as noted by The Telegraph too, showed that 58 per cent of students aged between 15 and 18 did not receive any form of financial education despite the fact that from September 2013, teaching financial education in secondary schools became mandatory following national campaigns.
The change was implemented by all state schools in September 2014, with financial education included in maths and citizenship lessons.
However, the report showed that students at GCSE level actually received little in the way of financial education, even though this is when teenagers will be nearest to making important financial decisions independently.
The Young Persons’ Money Index is an annual research report that examines the attitudes and behaviours of UK students in relation to money and personal finance.
The latest version of the report, launched in November 2016, surveyed more than 2,000 teenagers aged between 15-18 and was completed in September 2016.
The Index is broken down into three key sections.
The first concerns the delivery of financial education in schools and colleges in the 2015/16 academic year.
The second examines young people’s financial confidence and behaviours
The third looks at their attitudes to and interactions with personal finance in the context of improving financial capability.
In the area of Financial education:
The majority of students (58 per cent) currently do not receive any form of financial education in school or college; there is little change in the overall picture from the 2014 and 2015 surveys, when figures stood at 57 per cent and 59 per cent respectively.
Fewer female students (36 per cent) receive financial education than boys (45 per cent).
Older students (17-18) are significantly less likely to receive financial education than younger students (15-16), at a time when they will soon be required to make independent financial decisions about going to university or starting their careers.
More students are learning about financial education through Maths and Citizenship, following the inclusion of financial education into their respective curricula.
Financial confidence & behaviours:
Although financial education has been incorporated into the curriculum, 80 per cent of those surveyed listed parents and family as their prime source of financial information.
Teenagers said they would rather have someone else make decisions around their finances, with 78 per cent saying their parents had chosen their bank account.
Teenagers generally view their mothers as being “better” with money than their fathers.
Half of UK teenagers feel they have enough knowledge to manage their own money, but 61 percent say they have money worries.
The data also showed that teenagers aged between 15 and 16 have inflated expectations towards their future salaries.
Boys believed they would earn a salary in excess of £54,000 when they were 30, whereas girls projected their income to stand at £42,850 – well above the national average which is £30,400 and £27,500 respectively.
For those students who have already sat their GCSEs and where financial education is not formally part of the post-16 curriculum, 65 per cent of students say they do not learn about personal finance as part of their studies, regardless of whether they are studying A-levels, or other further education qualifications. However, this is an improvement on the 72 per cent of 17-18 year olds polled in 2015.
For younger students (aged below 17), 52 per cent do not receive lessons in school on personal finance.
Alison Pask, managing director at LIBF, said: “This is the third year we have conducted the Young Persons’ Money Index research and it continues to show us that there is a great deal to do”
“More students are learning about financial education through Maths and Citizenship, following the inclusion of financial education into the curricula.”
“To improve, as recommended by All Party Parliamentary Group (APPG) we need teachers to be financial champions, when they leave school young people will need to know how to manage money independently.”
“We are failing our young people if we don’t embed financial education across the curriculum.”
“Academies and free schools do not need to adhere to the national curriculum so 68 per cent of teenagers are still leaving school without this vital education.”