Financial education is only ‘scratching the surface’ and leaving young people woefully unprepared for life, according to new research.
The London Institute of Banking & Finance found financial education in schools was happening too infrequently to make an impact, leaving many young people worry about money.
While the number of young people receiving financial education in school has jumped from 44 per cent in 2017 to 62 per cent in 2018, the amount of time spent on financial education has dropped dramatically, the charity said.
In a 22-page report out today (7 November) it said a mere 33 per cent of students had had a lesson ‘in the last month’, compared with 43 per cent who said the same in 2017.
What's more, 14 per cent said their most recent lesson was ‘in the last term’ and for 23 per cent it had been a year or more since they had had any financial education.
This comes as the charity has been calling for clearer guidance to be given to teachers about what financial education should cover and for financial education to be allocated a mandatory number of hours – at least an hour a week.
Alison Pask, managing director for Financial Capability and Community Outreach at The London Institute of Banking & Finance, said: "The current approach can only scratch the surface of what children need to know about money, meaning they’re woefully unprepared for life.
"Being able to calculate interest rates and understand some financial concepts is useful, but that doesn’t add up to a financial education.
"Financial education is not being given enough time in the classroom, it’s not being taught in the right context and it’s not being delivered frequently enough. Young people need help understanding the practicalities of managing money – day-to-day and for the long term – and teachers need support to deliver that."
The charity's 2018 Young Persons’ Money Index found the inclusion of financial education in broader subjects was the most common delivery method, with PHSE, maths and citizenship being the lessons of choice in schools.
Only 3 per cent of schools reported having dedicated personal finance lessons.
Meanwhile, 71 per cent of young people said they worried about money, which marked a rise from the 62 per cent in 2017. This figure increased to 81 per cent in the 17 to 18 age group.
At the same time 83 per cent of young people said they wanted to learn more about money in school. This figure stood at 76 per cent in 2017.
Gemma Siddle, chartered financial planner at Newton Aycliffe-based Eldon Financial Planning, said: "A strong foundation in understanding finances from school age is vital to raise a generation who is financially savvy.
"Many financial mishaps and mistakes could be avoided by a deeper understanding and willingness to ask questions to ensure everything is understood.
"A cultural shift both in schools and in home lives to help young people feel more confident discussing these areas is needed. It is great to see more and more financial advisers giving up their time to help with this education; hopefully the tide will turn sooner rather than later."