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Around one in seven 15 year old students are unable to make even simple decisions about everyday spending and only one in ten can solve complex financial tasks.
That’s the finding, announced this week, of an international OECD assessment among 29,000 15 year olds in 18 countries and economies. Although the UK did not take part, Europe was represented by, among others, Belgium, Italy, Spain and Poland.
Financial literacy is a topic that affects every person in every country worldwide. For children, it’s vital to have knowledge of financial systems and acquire money management skills to succeed in life.
When I left school in the late 1970s, I was just as naive about money matters but today, more than ever, there are so many financial challenges that young people are faced with.
Back in the seventies and early eighties, you didn’t have to pay university tuition fees – heck, you even got a grant for subsidence! – and student loans hadn’t been invented.
Getting a mortgage wasn’t too much trouble in the eighties and in general the size of deposit you had to put down on a first house was modest. Today, a first time buyer needs about 20%.
The wired world we live in today requires money for broadband, a smart phone, and its monthly running cost, and a lap top.
The financial pressures on young people are tremendous.
Thankfully there is more onus on providing financial education and in the UK, the Personal Finance Education Group is the country’s leading financial education charity providing resources and lesson plans, help and advice to anyone teaching children and young people about money.
Parents can help, too, by trying to be as well-versed as they can on personal finance and passing this on to their children. Giving children a helping hand in adult life by taking out a savings or investment plan for them while they are young can go some way, too, to make a difference.
Stocks and shares investments can go down as well as up and the original amount invested is not guaranteed to be returned.
No advice has been provided by Scottish Friendly. If you are in any doubt as to whether a savings or investment plan is suitable for you, you should contact a financial adviser for advice. If you do not have a financial adviser, you can get details of local financial advisers by visiting www.unbiased.co.uk. Advisers may charge for providing such advice and should confirm any cost beforehand.