Despite financial literacy being introduced to the national curriculum in England in 2014, not everyone believes that school is the place for financial education. “While you’re waiting for refugee status, you’re in a cushion,” says Ibarra-Rivadeneira. understand how their financial decisions will affect them over the short, medium and long term.”. These would be reasons enough for the FT to be launching this initiative. “In five years or less, I will maybe have some savings, I will apply for a mortgage and I will buy a house. In a paper last year, Lusardi, who now heads the Global Financial Literacy Excellence Center at The George Washington University School of Business, wrote of the “near-crisis levels of financial illiteracy” around the world, with low levels of understanding even in advanced economies with sophisticated financial markets. A lack of financial literacy in education has undoubtedly played a role in this, with many young people under the illusion that simply earning a lot of money means that you’ll never be in any debt, along with a general unwillingness when it comes to making sacrifices for the sake of budgeting. Requiring financial literacy classes in high schools is a classic example of throwing what seems like a logical solution at a problem before it has been properly researched. In the coming months, the FT is going to establish its first ever charitable foundation, the Financial Literacy and Inclusion Campaign. Abdul (not his real name), a former asylum seeker from Somalia who now works at the camp, insists it’s not so bad. The fallout will hit every demographic. “It’s about basic knowledge, knowing your ABC of finance,” Lusardi concludes. Separating a financial literacy initiative from school runs the risk of educating only a portion of the community in financial literacy, while leaving the rest without the necessary skills to succeed financially in life. “And knowledge really is power. One UK primary school created its own bank, to combat ‘below average’ financial literacy learning. After one year, how much would you be able to buy with the money in this account? “If we’re to have a sustainable recovery it is vital that people . Quiz answers: 1 More than $102. You get into poverty and it stresses you out.”, Fatou says she has seen friends and acquaintances get into just that kind of fix thanks to preoccupations with how they look and what they wear, fuelled by social media: “A lot of people get so much in debt because they want to dress in designer stuff like they see on Instagram. “Financial literacy is a shield against shocks,” she says. It could be better. more useful for the majority.”. Because of these factors, there are many difficulties when it comes to making financial literacy universal, understandable. The video call proves a challenge — the classroom laptop is playing up and mask-wearing students are hard to hear. But it reflects a crucial point. Well, there’s no question that more financial literacy in schools is long overdue and sorely needed. If you still have any outstanding debt after 30 years, it is wiped out automatically. We no longer live in a world of paternalistic employers, nanny states and friendly bank managers. It’s a gap. Financial literacy builds students' understanding of personal finances, the local and global economy … These students are ripe for financial literacy education. The shift towards a myriad choice of financial products, self-determined retirement planning and sometimes unscrupulous companies that seek to exploit us has made it steadily more important for all of us to have a firm grasp of basic finance. 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