Consumer Rights: We all need a good dose of financial education
The charity-run My Money Week, which starts on Monday, is a good way to begin learning
Saturday 01 June 2013
After decades of flexing the plastic, applying a 'buy now, pay later' model to shopping and ignoring the small print, we can hardly be surprised that many people have little understanding of how to manage their money. Budgeting to pay the bills when they come due, saving in advance to buy things we need or desire, putting money aside for the inevitable rainy day – why should any of that make sense to generations brought up on instant gratification and debt?
Our lax attitude to money, and our tenuous grip on the principles of its management, has left us vulnerable to a variety of scams, cons and get-rich-quick schemes. While many financial organisations have been guilty of irresponsible lending, applying pressure on consumers to borrow and engendering a 'have-it-now' culture, we're also partly to blame for our own money woes.
It's time to get a grip on our finances, sort out the debts and take responsibility for our financial futures. That's what lies behind My Money Week, which starts tomorrow in schools all over the UK. It is run annually by the charity PFEG – the Personal Finance Education Group.
But where do we start to reverse the trend? For many people, it's too late to save for a more comfortable retirement or avoid the health problems induced by deep, unmanageable debt. So we need to start at the beginning. Campaigns to have financial education added to the school curriculum have been running for years.
Research shows more than three quarters of the population believe young people should be taught financial planning in schools. If you want people to be savvy savers instead of thriftless spenders, you need to get them young and keep them on side throughout life. Financial education leads to financial literacy and capability, and in turn to financial well-being.
Financial illiteracy in the UK has over the years contributed to our current economic crisis and to pension, endowment and PPI mis-selling scandals, to name but a few. The PFEG equips young people with the knowledge, skills and confidence to see when they're being sold a pup and to manage their money well.
Our lack of financial know-how costs the UK taxpayer £3.4bn each year, according to the Centre for Economics and Business Research. If we had better money skills, fewer of us would be unemployed and living on benefits. We'd save up for our retirement and reduce the bill for the taxpayer by a third, and our personal debts would be lower, saving us money on interest payments. More money could be used to help fund small businesses, which would contribute to the UK economy, and we'd know better than to sign up to poor deals that leave us worse off. If the calculations included scams, fraud and the bill to the NHS because of poverty and mental health problems, the figure would be much higher.
Financial education is crucial for financial security for families and the economic well-being of the country. Financial education will be included in the compulsory national curriculum in England from 2014 when it will become part of citizenship for 11-16-year-olds. Citizenship education equips young people with the knowledge, skills and understanding to play an effective role in public life. Currently, pupils learn about their rights, responsibilities, duties and freedoms and about laws, justice and democracy but there's nothing covering personal finance. The final version of the curriculum will be with schools by September.
Pupils aged 11 to 14 will be taught the functions and uses of money, the importance of budgeting and money management. Those aged 14 to 16 will be taught about wages, taxes, credit, debt, financial risk and a range of financial products and services. But even with financial education on the agenda for schools, parents are the most influential people in their children's lives and financial education at home is important.
Many parents feel they don't know enough to talk to their children about money, but they don't need to be experts. If they do talk to children about savings, budgets, debt and peer pressure, it helps. Many aspects of responsible money management are best learnt in real-life, and schools can't deliver that. But lessons can also be passed from children to parents, and often what's learned at school can make a difference to how money is managed at home. Financial education can create winners all round. You can find out more about My Money Week at www.pfeg.org
Q: My boiler broke down, and had to be replaced. The company that installed it put pressure on me to take out insurance. I signed but now I'm wondering if I need it. It's about £160 a year, and I feel I've been pressurised into buying something I don't need. Is there anything to stop me cancelling? FK
A: Last year, a fifth of boilers broke down and cost on average £320 to fix, according to comparison site uSwitch.com. So having insurance could save you money. But you need to check what's included in the policy. Most cover repairs, parts and labour, unlimited cover and claims throughout the year, and an annual service. Some policies cover your whole heating system, most have exclusions. You may also have to pay the first £50 when you claim, or a £50 call-out charge. A good reason for cancelling your policy would be it your boiler is already covered under your home insurance. If not you may be able to pay a bit extra to get emergency boiler cover cheaper than you're paying for your standalone policy. You could put the £160 a year into a savings account and build up a 'self-insurance' fund. If you do decide the policy isn't good value, check the terms and conditions for the cancellation.
Will your credit card rewards be scrapped following new EU rules on charges?
Buyers beware of new-build home headaches
Bargain Hunter: First Utility's Cosy deal lets you heat your home from anywhere
What would happen if you put a statistician in a casino with £1m?
10 tips for taking out a personal loan
- 1 Migrant crisis: Greek soldier saved 20 people singlehandedly off Rhodes beach
- 2 Frank Lampard's face drops when Holly Willoughby introduces him as a 'Man City legend'
- 3 UK weather: Britain braced for snow as arctic air mass moves in
- 4 Aaron and Melissa Klein: Oregon anti-gay bakers ordered to pay $135,000 after refusing to make cake for same-sex wedding
- 5 General Election 2015: Stephen Hawking says he will vote Labour
General Election 2015: Chuka Umunna on the benefits of immigration, humility – and his leader Ed Miliband
The sickening truth about food banks that the Tories don't want you to know
Aaron and Melissa Klein: Oregon anti-gay bakers ordered to pay $135,000 after refusing to make cake for same-sex wedding
Andrew Lloyd Webber: Phantom of the Opera writer mocked after issuing a warning about Ed Miliband and Nicola Sturgeon
General election 2015: Labour will toughen hate crimes legislation surrounding Islamophobia
HSBC review into moving headquarters from UK 'underway'
iJobs Money & Business
£20000 - £60000 per annum: Recruitment Genius: Are you recently QCA Level 4 qu...
£20000 - £22500 per annum + OTE £30K: SThree: SThree Group have been well esta...
£25 - 30k: Guru Careers: We are seeking an Application Support Analyst / 1st L...
£45K - £55K (DOE) + Benefits: Guru Careers: We are seeking a full stack .NET D...
Day In a Page
Surrounded by the Western fells, this five-bedroom Georgian home retains many original features including panel-plastered ceilings, sash windows and fireplaces.
This six-bedroom home is set amongst three acres of grounds. Currently a large family home, Clift Hill has potential to make a B&B, subject to change of use permissions.
A former period coach house, Glebe Farm Stable is now a three-bedroom cottage with a double car barn, office, kennels and an outbuilding that's currently used as a gym.
Set sail for this four-bedroom farmhouse in Cowes. With five acres of land and an indoor pool, this home oozes character. There is even potential to let a one-bedroom annexe.
Surrounded by woodland, this five-bedroom manor house has plenty of outdoor storage space in the form of three converted loose boxes, two smaller outhouses and a woodstore.
This four-bedroom detached home comes with a double carport, useful workshop, garden and two walkways that offer views of the adjacent countryside.
With space for an equestrian business, a greenhouse for growing your own veg, a wine store and a gym; this five-bedroom home has all the ingredients for a country retreat.
This four-bedroom home has exposed brick chimneys and a vaulted ceiling in a breakfast room that's ideal for summer entertaining - the doors open to the patio and garden.
The decked roof terrace of this two-bedroom flat is perfect for summer drinks while large windows and ample storage space make for a light and spacious interior.
Surrounded by approximately 15 acres of grounds, this six-bedroom grade II-listed home has been extensively refurbished yet retains many period features.
This four-bedroom home comes with a two-bedroom cottage and commercial office, with planning to extend, in a stunning courtyard setting.
In a pretty Norfolk village, this four-bedroom family home is surrounded by landscaped gardens, with even a self-contained annex for guests.
A few miles from the seaside at Perranporth, this four-bedroom farmhouse sits amongst nine acres of idyllic grounds - including a lake and two barns used as holiday lets.
This five-bedroom home is arranged over three floors of a converted Victorian hospital, offering spectacular views of the Pentland Hills - only three miles from the city centre.
This four-bedroom detached home comes with grounds that span to approximately 2.5 acres, as well as two large patio areas and a double garage.
This four-bedroom cottage is a Grade II-listed town house, well-located for the thriving market town of Nailsworth.
A four-bedroom apartment on the ground floor of a stunning period property in North Yorkshire, with two kitchens and a large south-west facing garden.
This high-spec two-bedroom home is part of a smart collection of new flats at Beaufort Park and has a large decked balcony that's perfect for summer drinks.
Capitalise on the fabulous views of Trevone Bay by taking two homes and creating one spacious boutique B&B. Just a cliff-top walk from Padstow.
Overlooking a golf course, this six-bedroom Edwardian detached home spans four storeys and retains many period features including the original, operational servants' bells...
On the edge of the city, this six-bedroom home comes with an outdoor swimming pool and a large garage block that has annexe potential.
In a Grade II-listed manor just outside of Bath, this three-bedroom home is arranged on two floors with a skylight in a vaulted roof line.
Open the living room's bi-fold wooden doors to reveal a retro-style kitchen, and a conservatory leading to a paved garden at this three-bedroom home.
A Grade II-listed, four-bedroom home, in a charming Somerset village, with a two-storey studio that could be converted into a holiday cottage
A modern four-bedroom Victorian home, within walking distance to the high street
A luxury apartment in the Gothic mansion of Wyfold Court in Kingwood, offers six bedrooms spread over three floors and a turret
This school conversion, near Stockwell Tube, oozes New York loft style. The one-bedroom flat features double height ceilings and exposed brick work
This six-bedroom Georgian home is on three floors with open fireplaces, a two-oven Aga, an annexe, and cottage gardens with outbuildings and a car barn
High Crest House covers an impressive 9384sq ft, with almost three acres of grounds including a tennis court and summer house enclosed by electric gates
A six-bedroom farmhouse with separate accommodation in converted stables. Situated in the village of Church Aston, within walking distance to the market town
A two-bedroom flat with under-heated walnut floors and bespoke built-in storage. The Tube and Clapham Common are a short stroll away
A refurbished seven-bedroom townhouse with staff quarters, cinema room, superb gym, steam room and plunge pool
A minimnalist four-bedroom home designed to the highest spec, featuring glass walls and a kitchen space lit by a glass roof
Hibernate during winter and make your living during the summer at this busy guesthouse with panoramic sea views, in the village of Lynton
A four-bedroom penthouse next to the Tate with direct views of St Paul's from two floors of luxurious living space
A four-bedroom detached home surrounded by spacious gardens and woodland, close to New Pudsey
An 18th-century, three-bedroom home near Langstone Harbour built from ships beams with vaulted ceilings and wood burning stoves
A five-bedroom semi-detached home with a mix of period and modern features in a popular and convenient location
This five-bedroom red-brick beauty overlooks the village green and sits in just under two acres of land
A three-bedroom villa with self-contained flat, minutes from Lake Windermere
A five-bedroom Victorian home with four receptions, superb gardens and paddock in Pembury
An eight-bedroom house on the south side of the The Green with cinema, wine cellars and summer house
This 17th century beauty is full of rustic cosiness, while the detached home office means you can also run a business
Four exclusive apartments in a Grade II-listed former medical school with 2,275 sq ft of living space and 18ft ceilings
A five-bedroom terraced house on the popular Peterborough Estate, ideally located for both Eel Brook Common and South Park
A state-of-the-art farm-building conversion on the former Cliveden Estate, with 11,420sq ft of internal space, cinema and wine cellar
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
A boutique mews house, set around a central courtyard, with three bedrooms and a private roof terrace