It has never been more important for young people to understand how to manage their personal finances.
Youth unemployment stands at nearly one million. Young people who are in work are struggling against high rents, rising transport costs and worrying levels of personal debt. The result is a bleak picture for today’s generation of school-leavers.
These are, of course, highly complex social problems that no one measure can solve on its own. However, teaching personal finance in all of our schools is one policy that can achieve real results by preparing young people for the challenges that will confront them in later life. We urgently need to give all young people the skills, knowledge and confidence they need to be able to manage their money well, now and in the future.
The good news is that as of February this year, the government agrees. In its draft national curriculum for England, the Department for Education has confirmed that financial education will be included in both mathematics and citizenship education at key stages 3 and 4 for the first time.
A double victory
This has been a double victory for a two-year campaign led in Parliament by the All Party Parliamentary Group (APPG) on Financial Education for Young People, with the support of pfeg, the Personal Finance Education Group, and Martin Lewis from the website MoneySavingExpert.
Together, we have been lobbying ministers to include financial education in the national curriculum since the publication of the APPG’s report on its comprehensive six-month inquiry in December 2011. The campaign has enjoyed widespread support from teachers, parents, young people and MPs of all parties – and we are delighted that ministers have listened.
The inclusion of “financial mathematics” in the new programmes of study for mathematics means that pupils will be taught the “factual” side of personal finance, such as calculating interest rates and comparing energy tariffs, to a greater extent.
However, financial decisions rarely have right or wrong answers – and so a second, more subjective, decision-making side of financial education is also needed to equip young people with all of the skills they need to be able to manage their money well.
This is why we are pleased that the broader issues around financial capability, including these more subjective elements, have been included in citizenship education.
The new stated aims for citizenship include equipping pupils with the skills “to manage their money on a day-to-day basis as well as plan for future financial needs” – and will go a long way towards improving the financial capability of future generations of school-leavers.
What this means in practice
The programmes of study for key stage 3 and 4 mathematics contain many specifics relating to financial education, including the solving of problems relating to interest rates, pricing and loan repayments.
Money has long been used as a context to teach mathematics, but the new draft curriculum goes further than merely using personal finance as a context. We are encouraged by prominent references to “financial mathematics”, recognising the importance of teaching methods to solve problems relating specifically to personal finance.
In citizenship education, the draft curriculum includes specific subject content. At key stage 3, it states that pupils should learn “the functions and uses of money, the importance of personal budgeting, money management and a range of products and services”.
At key stage 4, pupils should be taught about “wages, taxes, credit, debt, financial risk and a range of more sophisticated financial products and services”.
This is a significant change and will have a big impact on the way that citizenship education is delivered. While teaching about public money and how economic decisions are made are both part of the existing 2007 programme of study for citizenship, teaching about personal finance will be a new area for the vast majority of citizenship teachers.
Help is at hand
There is a wealth of free support and advice already available for teachers and anyone else interested in teaching young people about money. Pfeg offers free support, advice and consultancy, including over the phone via the pfeg Advisory Service.
The website also contains a large library of free financial education resources for use in the classroom – developed both by the charity itself and by third party providers whose resources have been awarded our Quality Mark accreditation.
In the meantime, schools across the country are making a head start by taking part in My Money Week, which is returning for its fifth year thanks to a new partnership between pfeg and Barclays.
The aim of the week, which will run from June 3 to 9, is to support teachers in educating pupils effectively about money through fun and engaging activities.
The new partnership is part of a pledge by Barclays to improve the financial knowledge of a further one million young and vulnerable people in 2013 through the Barclays Money Skills programme.
Getting involved in My Money Week is a good way for schools to take their first step into financial education before the new curriculum comes into effect in September 2014. Teachers can order a free My Money Week Activity Pack, which has resources and ideas for how to teach financial education, online.
New teachers working in financial education may also be interested in the planning frameworks that we have developed to help the teachers we work with to embed personal finance into their teaching. Our planning framework for secondary schools is currently in draft form and we would welcome the thoughts of SecEd readers.
The bigger picture
While last month’s victory on the national curriculum was a big leap forward, it remains only the first step in our wider campaign for financial education to be taught in every school in the UK.
This includes extending personal finance teaching to primary schools through the citizenship/PSHE framework, and of course continuing to promote the benefits of financial education to academies and free schools, so that their pupils receive the same benefit that the new curriculum content will bring to their peers in maintained schools.
At long last, financial education can now add the endorsement of the government to its long list of supporters. This is a giant leap forward for the campaign for every young person to be given the skills, knowledge and confidence they need to manage their money well. I am confident that through their work on the ground, teachers will turn this victory into a lasting benefit for young people.
Tracey Bleakley is the chief executive of pfeg (Personal Finance Education Group). Visit www.pfeg.org