Debt Advice Foundation calls for financial education in primary schools to halt rising consumer debt
As a leading debt charity, we believe that financial education needs to become a national priority to stem the tide of rising consumer debt.
As a leading debt charity, we believe that financial education needs to become a national priority to stem the tide of rising consumer debt.
A recent report by the Bank of England revealed that consumers are even more reliant on credit than ever, as the rate of consumer borrowing has risen to its highest level since 2006.
Debt Advice Foundation CEO David Rodger said;
“We believe that many people find themselves in serious debt because they have never been taught even the basics of money management and that young people should be given the chance to learn money skills at the earliest opportunity by taking financial education into the heart of primary schools, before damaging financial habits are formed.”
Despite the requirement for children to be taught to manage money forming part of the curriculum for secondary schools since September 2014, many schools still do not have a programme in place.
Research by the Money Advice Service showed that more than four in five teachers believe that financial education should begin at primary school, not secondary school, to be most effective. In fact, the findings revealed that many of the behaviours that are crucial to the formation of financial habits in adulthood are established by the age of just seven years old.
Furthermore, charity figures show that people aged 18-24 are significantly more likely to have high cost short-term loans in comparison to their older counterparts (9.4% compared to 0.43% of 45-50 year olds), suggesting that the need for financial education has never been greater.
David Rodger, commenting on the figures, added;
“We’ve been concerned for some time that rising tuition fees may be having a detrimental long-term effect on the financial wellbeing of young people by desensitising them to commercial debt. Putting £2,000 onto a credit card may not seem like such a big deal when they know they will be leaving university with over £20,000 worth of student loans company debt. Educating young people about financial products and budgeting at an early age, before they go to university, should help combat this.
“There has been a lot of talk in the media about how young people face a potentially bleak future with regards to debt, housing and pensions. Learning to plan and budget for the future is an essential component in stopping this from becoming a reality.”
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