Personal Finance Programme To Be Introduced in Schools

Young Britons could be set to develop a more responsible approach to loans in later life following the introduction of a multimillion pound financial literacy programme in schools, it has emerged.

Under the 11.5 pounds million objective, primary and secondary school pupils across the country are to receive access to resources aimed at helping them to manage their personal finances throughout their childhood and as they get older. Consequently, as a result of becoming more aware of financial terms and products such as personal loans in their youth, children could be able to manage their money and create budgets more effectively in later years.

Under the scheme, in which funding will be made available from 2008 to 2011, a variety of resources will be centered around Child Trust Funds (CTF). By using CTFs as a way of talking about managing money in maths lessons, teachers could be set to bring “finance to life”. In addition, staff are due to receive “high quality training and support” so as to help them pass on the best possible knowledge of personal finances to children.

Meanwhile, the secondary school curriculum is set to include a specific economic wellbeing and financial capability section, where pupils will be able to learn about budgeting, tax and savings, as well as monetary products such as personal loans and pensions.

Commenting on the announcement, Ed Balls, secretary for children, schools and families, said: “It’s never too early to encourage children to think about money and saving for the future and we want to ensure that every child, no matter what their background, has the financial skills to achieve whatever they want in life.”

He added that as CTFs provide a “financial head start” for children, the need to learn how to manage money is set to become “real and tangible in the classroom”. As a result, he claimed pupils will be able to apply what they have learnt when applying for a loan or setting up a savings scheme in later life. “It is vital children understand how maths is relevant to everyday issues like opening a bank account, shopping and saving,” Mr Balls claimed.

Treasury minister Kitty Ussher added: “Financial understanding is a key life skill. Children need to understand the value of money and how to interact with financial service providers to provide for their own futures. The skills they will learn in class, combined with the experience of having their own savings product, will better equip them to avoid financial problems in later life.”

Towards the end of last month, a Citizens Advice spokesperson reported that the introduction of mandatory personal finance education in secondary schools could vastly improve the general British attitude towards credit. The representative claimed a “lot of debt problems” are due to a shortfall in knowledge about financial terms and confidence when to comes to dealing with money. However, by bringing in classes, children may be able to learn how to budget their outgoings and search for a competitive rate of interest on an unsecured personal loan.