US Edition
My Instagram feed is filled with influencers dishing out personal finance tips and tricks – or “finfluencers” as they are known. They teach me how to save, budget and invest in short, snappy videos. It is almost as though Mark Zuckerberg’s all-knowing algorithm can sense what my education lacked.
I remember learning about menstruation and safe sex, illustrated by rolling a condom onto a banana, in PSHE lessons while at school – but I cannot recall a single class that covered the basics of financial literacy. This is despite PSHE standing for Personal, Social, Health and Economic education.
Of course teaching girls about periods and avoiding unwanted pregnancy is necessary, but surely they could also have squeezed in a few classes where we learnt about mortgages, pensions and how to handle credit cards.
Instead I left school with no clue about saving, budgeting and a myriad other financial life skills that could have helped me to this day. I’m not alone. Nearly 70pc of Britons believe better financial education would have helped them manage their finances in the cost of living crisis, according to research carried out by Santander.
In fact, even as soon as university, I saw the consequences of this scant financial education. I watched as friends went wild with credit cards and store cards, giddy over what appeared to be free money. Some racked up colossal debts and did lasting damage to their credit ratings.
The luckier among them had those debts paid off by parents who then cut up the cards and called the sorry episode a learning experience. The unlucky ones had to pay off the debt themselves. One friend is still paying off a youthful store card fiasco, ten years later.
The teenage mistake makes it difficult for her to rent her own flat as it pops up in credit checks carried out to screen prospective tenants. I’m not saying financial literacy lessons would stop all 18-year-olds going mad with a credit card, but I’d bet we’d see those instances fall.
Financial literacy lessons do not appear to have improved much since my time in the classroom. Although financial education became part of the national curriculum back in 2014, a survey of more than 400 teachers revealed that two-fifths of teachers did not realise that teaching it was a legal requirement.
It seems other subjects – such as teaching children how to combat “climate anxiety” by passing around an egg painted like a globe until it drops to the floor and breaks to illustrate the fragility of our planet – are considered more important than boring old interest rates, inflation and student loans.
Is it any surprise that so many young people are turning to TikTok, Instagram and YouTube to learn how to handle their money? The influencers I follow explain the benefits of an Isa, give non-judgmental advice on how to deal with debt, and have introduced me to the 50-30-20 budget whereby you spend 50pc of your income on needs, 30pc on wants and 20pc on savings.
The accessibility of this expertise – try getting an appointment at your local bank to discuss different ways to budget – is one of the boons of the digital age we live in. Though, as with all social media, there is a dark side to “FinTok” too. Some finfluencers have no financial qualifications and advise their followers to pour their savings into high-risk investments such as cryptocurrency.
While I am a fan of the clear and practical saving tips I find on my Instagram feed, it cannot and should not replace a comprehensive grounding in financial literacy that no child should leave school without. What a blind spot to be left with.
It’s all well and good to be able to parse a line of iambic pentameter and speak with knowledge about the fall of the Weimar Republic, but now, at the grand old age of 35, I rather wish I’d left school with even a dim understanding of compound interest and the importance of investing young.
Should financial literacy lessons be prioritised in schools? Share your view in the comments section below
Teach children about pensions – not just how to put condoms on bananas
Kids are leaving school clueless about money and then turning to TikTok