christobyer: Weekend reading: Should personal finance be taught in school?

Sunday, May 6, 2012

Weekend reading: Should personal finance be taught in school?

Good reads from around the Web.

Lee and Rob, two up-and-coming personal finance bloggers in the UK, are calling for better financial education in schools.

Over on Five Pence Piece, Lee writes:

Right now students leave the family unit to enter further or university education ? or the even more daunting world of work ? with only the vaguest hint of how to manage their money, wages, taxes and bills.

The little that is taught is about the math and not about the personal responsibility, the benefits of being financially astute and the dangers of not. It does not present the knowledge in a fun and ?wow? style; it?s just all about the numbers in the maths lesson.

Rob continues the theme on his own blog:

I was never taught anything about personal finance and to be honest with you I wish someone had at least taught me how to fill in a tax form or taught me my responsibilities with capital gains tax. ?These are all things I had to teach myself when I didn?t see why they weren?t taught at school.

The two would like other personal finance bloggers to share their own views on educating youngsters in the ways of debt, APRs, and interest only mortgages.

I?m happy to highlight their campaign. But I?m not sure they?d want me on their team!

I?m skeptical of school-taught education, to be honest, especially pseudo-practical knowledge that is theoretical until you?re faced with buying your first house, say, or taking out car insurance.

I?ve seen plenty of people?s eyes glaze over as I?ve tried to explain how mortgage repayments work over the years. I don?t think little Johnny gives a monkey?s.

But to not be totally negative (who could argue with the aims?) I would certainly teach kids about compound interest, perhaps by alluding to the still-magical ?1 million figure. That could capture the imagination.

Beyond that, I?d probably try to find something that appealed to the here and now, rather than to their future selves.

Lessons in the second series of?The Wire gripped the young proto-gangsters with the economics of a corner drug dealing spot, but I?d hope things are not so bleak yet in the UK.

Perhaps using the personal finances of a top-flight footballer or a reality TV winner might do the trick?

The bottom line is our education system is teaching kids to start working life mired in debt by going to university without evaluating the return, so I don?t think Rob and Lee should hold their breath.

But I wish them better luck than even the mighty Martin Lewis had with his e-petition to Parliament.

From the money blogs

Deal of the week: I sheepishly admitted to a published novelist the other day that I only read five or six novels in a year. As a teenager I read more in a month! He harrumphed. Perhaps I was a bit insensitive, but am I unusual? A friend swears by audio books, and I see Amazon spin-off audible is offering a free audiobook download to seduce the unconverted.