Why Family Finance Planning and Financial Education for Children Are Vital

We often share similar values to our parents when it comes to money, such as being frugal or worried about money. Inherited values are not always useful, especially if money has been a taboo subject or a theme of arguments in a family unit.

It is my strong belief that financial education should start at infant school and progress throughout a child’s education. Understanding the value of money, how much things cost and the importance of careful management is key to our success as a society. There is a general attitude of ‘live for today’ and as a result of cheap credit and loans, certainly over the last decade, it’s been easy to buy what you want without having to save up and this has led to high personal debt and a negative relationship with money in general.

Our Prime Minister Rishi Sunak is proposing that all children study Maths until the age of 18. Yes, we need to improve our numeracy as a society but this is not how to go about it in my opinion. By the age of 16 a child has developed their relationship with money and pushing them into more education and exams is not the answer at all. It’s not algebra children need to learn (unless Maths is their chosen route) it’s having a good solid financial education and instilling a degree of common sense. Things like budgeting, inflation, compound interest, credit cards, saving, mortgages, buying a house, rent, basic tax on income, what is a pension?

I have been in schools and colleges to educate children on exactly this subject. It can be very basic initially and a little more advanced as students near the time when they go off to University or into the workplace where they will have to manage a monthly income or student loan.

We don’t all aspire to be investment bankers or hedge fund managers but we all need basic financial skills to make informed sensible decisions about money. That old adage, ‘I wish I had known then what I know now’ rings true for many of us when it comes to money.

It is always best to teach face-to-face, equally, interactive online learning can be useful also. I am sure that the Government’s money (well ours as taxpayers actually!) would be much more successfully deployed developing some online tools and employing financial experts to go into schools and deliver this education.

Our children need good role models to inspire them. We have some amazing business owners and sportsmen and women in the UK, and many of them are happy to give up their time (as I have) to mentor/educate and share their successes and failures with the next generation. The Government needs to promote this and link the businesses with the schools and colleges.

Sadly we lack good political leadership and it certainly hasn’t been inspiring of late, or indeed for quite some time.
As a Country, we need to wake up to this deficiency in financial education otherwise we will be left behind compared to other countries. A significant number of our children have missed out on 2 years of ‘normal’ education because of the pandemic and this has had a marked negative effect on them. Only by fostering children’s individual talent and supporting their progress, which does not necessarily mean extending Maths learning to age 18, will we be successful and become more productive as a nation.

In my role as President of the British Association of Women Entrepreneurs, I hear on a regular basis how difficult it is to get Government funding for apprenticeships. This has to change. I am a firm believer in the benefits of apprenticeships from age 16 and less focus on academia beyond this age.

Our skills gap is widening as we lose more highly skilled over 50s to early retirement. It’s imperative that we bridge this gap and implement a strategy urgently. If we don’t, well then sadly I fear for the future of our economy and our ranking as a major player on the world stage!