You don’t know what you don’t know. Many of us have to learn about finance the hard way, either through trial and error or years of making little mistakes here and there. Personal finance is an area we all engage in whether we like it or not, so it’s amazing that there’s not more financial education taught in schools.
The Personal Finance Society (PFS) is one organisation that is trying to change all this. Here’s what they’re doing and why it’s important to take ownership and gain at least some understanding of finance.
What is meant by ‘financial education’?
This can cover quite a broad range of topics. Some of the most popular personal finance areas that the PFS teaches in schools includes subjects such as:
The PFS teaches these lessons to children between the ages of 11 and 18 years old as part of its ‘My Personal Finance Skills Programme’.
Why is it important?
Proper financial education doesn’t just end with the basics mentioned above, and learning isn’t just for the kids. We adults should also be making sure our minds stay as sharp as razors when it comes to financial know-how.
There are certain financial events and milestones that we should be prepared to encounter at some point in our lives. Understanding of the following finance fundamentals will give you a massive confidence boost and make life a lot easier:
- How mortgages work
- Why pensions are important
- What the different tax rules are and how they impact your pay
- The structure of student loans
- Basic knowledge of credit cards and borrowing
- How to invest money
What are the benefits of financial education?
It’s likely that with a better understanding of personal finance, you’ll save money, time and stress. With education comes knowledge and confidence when it comes to managing your finances.
With a decent bit of money knowledge, you’ll also find it easier to avoid debt and perhaps even begin to build wealth from a younger age by investing in shares.
How can you get a better financial education?
The best thing about learning is that you can educate yourself for free. Don’t worry if you’re not in school anymore. There are plenty of resources out there that you can watch and read.
Here at The Motley Fool, we aim to provide you with information on all sorts of topics to help you make better sense of the world around you and how it impacts your finances.
Finance may not be a topic that really excites you. But a lack of understanding can hamper your progress as you make your way through life. It’s great that more children are learning about it, but there needs to be even more widespread education across every age.
Should you be teaching others about finance?
If you already have a good level of financial know-how, it makes sense to help those around you. Even if your children aren’t enrolled in programmes at school, you can instil good habits in them.
One of the best things about financial education is getting to share what you’ve learnt. Personally, I was never taught about finances at school. Now that I have a better understanding of money, I find it really rewarding to discuss and pass on information to others.
So if personal finance is something that interests you, make sure you share the wealth! You could really change someone’s life with just a few nuggets of quality information.
Some offers on The Motley Fool UK site are from our partners — it’s how we make money and keep this site going. But does that impact our ratings? Nope. Our commitment is to you. If a product isn’t any good, our rating will reflect that, or we won’t list it at all. Also, while we aim to feature the best products available, we do not review every product on the market. Learn more here. The statements above are The Motley Fool’s alone and have not been provided or endorsed by bank advertisers. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool UK has recommended Barclays, Hargreaves Lansdown, HSBC Holdings, Lloyds Banking Group, Mastercard, and Tesco.