>Children and Money – do we do enough?
>A friend of mine recently told me a story. He has a young daughter and every now and again he plays “shop”. As well as being fun, the idea of playing this game was so that his daughter could understand more about how money works in the real world. His daughter plays the shopkeeper, and my friend is the customer. They use one of her toy bears as the “product” and set a price for what she might have paid for this toy bear. Then she sells it to my friend. The first time they played, she tried to sell it for less than she paid. This gave my friend the opportunity to explain that she should be charging more. The next time she picked a price of a million pounds (quite expensive for a teddy!)….but as they played more and she understood the nature of the game she started to pick prices which were reasonable but over the amount she had paid.
PFEG (Personal finance education group) provide a great range of resources to educators to help teach financial capability and that is a huge step forward from providing any form of financial education in schools. However, I’d suggest that although we are making huge strides in helping our children prepare for the real world I believe we still have a way to go. My belief is that teaching financial capability as a core part of the curriculum is the best way forward. I’m proud of my B in GCSE in geography however it’s not really been the most practical qualification in the world and surely any school, college or university leaver would have find learning how to become more financially capable of far greater benefit to them both day to day and longer term.
pjhoskin
April 5, 2012>Hi Chris,
Whilst I was teaching at Colchester Institute (a local further education college) part of my role as Financial Services Lecturer was to teach 16-19 year olds a Financial Capability qualification. I was shocked at the lack of knowledge around personal finance that the young adults had. Needless to say they had a greater knowledge and were armed for the big wide world of finance by the time they finished the course.
I second your beliefs, in that; financial education needs to start at a young age to build a foundation of knowledge which can be built on as our children get older.
I also believe that responsibility for this is shared between parents, schools and the government.
The trouble is, as with all education, it’s not quite that simple. The question is, have parents, some of which will be younger than others and less financially experienced, have the knowledge and experience to be able to teach their children.
I think that this is a bigger issue and I fully support the government’s initiative of educating the public re financial matters so that they are more informed and be able to make better choices in their financial lives. There are very good courses available for adults of all ages.
I see our role as Financial Planners playing a major part in this by helping people with all financial matters so they have a better understanding of their financial lives so that they are able to make informed choices about their financial futures.
Chris Daems
April 5, 2012>Hi Paul,
Thanks for your comments….really useful!
I think you're right….whilst financial education at School is one part of the puzzle for having more financial literate children, the issue is a greater one. I agree that parents have a huge responsibility to make change…however I think the assumption there is that the parents also want to make a change. Some will and support their children to develop…however some won't. I think a lot of this comes down to aspiration.
Whilst a motivated parent at any age will take the opportunity to educate themselves, there are many parents who will not take this opportunity. I'm not sure what you can do to motivate parents and then in turn motivate children to be more financially literate…that I believe is a far bigger issue. However I agree that as financial professionals we can do what we can to educate people in a variety of ways.
A couple of years ago, Cassie asked me to come down and run a group for the mums in her childrens centre in Tower Hamlets for free. I happily obliged and got some positive feedback from the parents on the content (mainly around budget planning and managing debt)…we had 7 mums with many more invites being sent.
These parents had the opportunity to access a Financial Planning professional for free but opted not to. So, the issue sometimes isn't access to education….it's the motivation to do so…and I'm still not sure of how you motivate individuals who are currently disinterested and disengaged in learning how to manage their money into wanting to.
pjhoskin
April 5, 2012>Totally agree, as with all education, there has to be an appetite for learning in the first place.