Now is the Best Time to take a GCSE in being solvent

WEDNESDAY, DECEMBER 20, 2006

Due to the number of insolvencies and the growing number of those in serious debt, personal finance education is very important to many politicians and individual organizations. Recent figures from many major research reports show that ìBritons now owe more than £1 trillion, and the average student debt is £15,000 and rising.îThe government is expected to announce plans about their financial education course of action in the very near future. George Osborne, the shadow Chancellor, recently publicly said that they will ensure that financial education will soon become a subject of study in all schools to prevent future generations from finding themselves in deep debt.

Many groups are even beginning to propose introducing personal finance into every schoolís curriculum as early as 2008. These classes will be taught under the subsection ìFunctional Maths.î However, this education will onlu account for 10 per cent of the functional maths module, or about 4 hours a year.

Phil Hall, of the IFS School of Finance, a financial education charity, says, ìfour hours is not enough,î and that he has, ìgreat concerns about the subject being incorporated into the new functional maths syllabus.î

ìIt's totally inadequate and does little to address financial incapability,î he says.The IFS school is the one and only organization in Britain that helps provie personal finance qualifications in many schools. They administer GCSE equivalent (the Foundation Certificate in Personal Finance) test for 14-year-olds, an AS-level equivalent (the Certificate in Financial Studies) test, and an A-level equivalent test for sixth formers.

Now, many secondary schools around the country have begun to teach these certificates to GCSE and sixth-form pupils. According to Hall, enrolment is growing: 'îhis time last year, we had 2,200 students enrolled, now we have over 6,600. We are teaching crucial lifestyle skills, regardless of background. Whether you're going to be a road sweeper or a rocket scientist, you will still need to learn how to manage and make the most of your finances.î

According to Hall, ìThe most important lessons are about appreciating money and sticking to a budget. One of the first questions we ask students is what the five most important milestones will be in their life - going to university, buying a house or buying a car. We then ask how they plan on funding it, and that's when the concept of saving for the future kicks in. We teach students about reading between the lines.î

For adults, the IFS plans to help those already in debt by creating adult personal finance classes in the near future.