Why do we need to teach financial literacy in schools?

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Having at least a basic grasp of personal finance is essential to live in today’s world. Some say it’s even an integral part of feeling happy and secure. After all, it can guide us to live, save, borrow, and exist within society. Understanding how debt and investing can affect your life is incredibly important, and there’s no escaping it.

At the time of writing, financial literacy isn’t widely taught in schools. Maths is, economics can be if you choose to pursue it, but life skills such as managing income and outgoings are not. Considering it can make the difference between poverty or success, you’d think there would be more onus placed on it.

Technology has empowered us

Over the last decade, technology has changed the way we live. It has entered every sphere of society and revolutionized previously stagnant sectors. It has also empowered citizens to take back control of various aspects of their lives. For example, online banks allow customers to manage their payments, cards, accounts, and everything else from their mobile phones. They facilitate exchanges and savings and can even trade currency with a swipe of the thumb.

It’s also made access to lending much more efficient. Sites like Trussle that provide online mortgage advice and comparison services are good examples. Instead of going through a broker, the prospective house buyer puts in their budget, and the site tells them which lenders have suitable offers. This gives a much higher level of autonomy to the borrower, empowering them to get the best deal available.

Additionally, it’s easier to invest in stocks and shares or to buy up cryptocurrency. Individuals educate themselves through podcasts and forums and then head off to try their luck investing.

While this level of financial emancipation is great, it does have risks. Without teaching the fundamentals of finance in schools or in a methodical way, consumers are disadvantaged. They find themselves more susceptible to fraud, scams, or just making expensive mistakes. Even when working with a reputable company or service provider, if the customer isn’t knowledgeable, it’s easy for them to trip up.

What to do in the meantime?

For many of us, it’s too late to go back to school. As for teaching financial literacy in schools, we might be waiting some more years yet. So what can we do to help educate ourselves in the meantime?

There are many online courses out there that provide a basic introduction to financial management personally. These could be free or paid. They could end with a qualification or not. There are also plenty of podcasts and videos online which can take individuals through the basics and even more advanced aspects of the topic. A good place to start is by hunting down lectures from financial courses, many of which are available for free.

Lastly, it’s a good idea to join forums where many of your peers are present and discussing this topic. You can search for specific threads or browse. Be sure to fact-check the information you find with reputable sources, and remember, if it sounds too good to be true, it probably is.

The case for teaching financial literacy in schools is growing. As the sector becomes more open and accessible, the necessary tools need to be provided so the general public can navigate it with care.

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