Financial education must be practical and apply clearly to real-life situations, the Personal Finance Education Group (pfeg) has warned.
Speaking in light of the government’s recently aired plans to invest in financial education, pfeg director of policy Alastair Mathews said theory must be translated into practice to keep debt at bay.
“pfeg do not advocate a purely theoretical approach to financial education – we have always said that it’s important, in giving the financial education that young people need… that they get practice of financial decision making,” he explained.
“Theoretical financial education is not a lot of help. It explains the phenomenon that you get, where some students have already learned something about personal finance in their business and economics work – and yet they still don’t have a clue how to manage their credit card.
“They know something theoretically, but don’t know how to apply it in practice.”
Eight in ten of those canavassed in the Future Leaders Survey 07/08, conducted by environmental charity Forum for the Future, universities association UCAS and insurer Friends Provident, said that they were either ‘very’ or ‘quite’ good at managing money.