Compulsory lessons in debt for children from 2011
School children will be given compulsory lessons on managing their finances, ministers have announced.
It follows a study by the Institute for Social and Economic Research that found being unable to manage money harms a person's wellbeing.
Ministers believe the compulsory lessons could educate the next generation to avoid the pitfalls of debt. Schools will be required to teach children how to spend with restraint, borrow within sensible limits and save prudently
Ed Balls, the children, schools and families secretary, said: "It’s vital that all young people leave school with a basic understanding of how to manage their money sensibly,” said Balls.
“So it’s really important that we teach our children about money matters like pensions, responsible saving and effective money management.”
The lessons in 'economic wellbeing and financial capability' would be part of personal, social, health and economic education, compulsory for all pupils from September 2011.
From 2011, five-year-olds will begin with lessons on how to save money in a piggy bank. While at primary school, they will be taught about current and savings accounts and how to budget. In secondary school, the lessons will move on to credit cards, mortgages and loans, with specific warnings about debt.
Pupils aged 11-14 will also learn how to pick the deals that suit them best without being fooled by advertising.
Mr Balls said: “We need to make sure all young people have the information they need to prepare them for the complexities of today’s modern world so they can give security to their families and prepare for the future."
Martin Lewis, founder of moneysavingexpert.com, who is launching the courses with Balls, said: “Over the past 20 years we’ve dug a hell-hole of personal borrowing problems. This is a welcome first step.”
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