Sunday, January 30

Teach children how to manage finances

This article made me a bit upset. We are trying, via the SIFE trading game, to get more students up to speed on their financial situation, learn about how to handle savings, manage expenses, so on and so forth. Why on earth do we not teach our kids how to manage their finances? This is ridiculous. I quote:

The case for this is really strong. A paper out by the Financial Services Authority today says that most consumers don’t understand basic financial terms.  They don’t know what compound interest is, and they can’t work out whether the loan rate on the credit card is a good deal or not. They don’t know enough about bonus rates on savings products, so they frequently stay with their bank long after the savings rate it offered stopped being competitive. They don’t understand risk and reward in investment, so they are surprised when their fund, cosily named ‘Cautious’, falls 40 per cent in value.

We should be doing more to teach our kids how to manage their money so that they dont have bad financial histories and have to rely on the state because they cant be financially independent. The education secretary should really rethink this.

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