Understanding the value of money is the main barrier to children learning more about financial common sense, according to new research by one of the UK’s top building societies.
Newcastle Building Society found that around a third of the 40 North East head teachers and teachers it interviewed to try to identify the barriers to children becoming more money savvy said the children they taught generally failed to understand the value of money and cost of items.
Those surveyed put the problem down to the children not handling money and not consequently being able to relate to what items cost and how they are paid for, with a further 13% of the teachers saying a lack of family knowledge about finances also played a part.
One South Tyneside head teacher said: “My 13 year old son has an iphone and does not understand how long it takes to earn and save the money that you need to buy such an item, and I bet that’s the case with a lot of children nowadays.
“This generation of teenagers and younger are used to owning expensive items and not truly understanding the value of the money that was used to purchase them. It doesn’t just come out of a hole in the wall.”
The Society carried out the research as part of the financial education programme that it has run in regional primary schools over the last five years, which aims to promote financial independence later in life, and will use its findings to refine its work with the schools in the future.
All the teachers surveyed agreed that making financial education part of their school’s timetable was important, and that the teaching of it should happen as early as possible, around the age of seven.
Over four fifths (83%) of them also said that better classroom materials would help them teach financial education more effectively, with around three quarters saying better online resources is what is required.
Natalie Falkous, Group Corporate Communications Manager and Head of CSR at Newcastle Building Society, said: “The credit crunch taught everyone important lessons about managing money, and it is crucial this generation of children are as well informed as possible about where money comes from, how to look after it and what the benefits of being financially independent later in life will be for them.
“We have run a successful financial education programme in local schools for five years now, but during this time, we have seen the many pressures on teachers and the barriers to children learning effectively about money.
“The teachers we spoke to are clearly very passionate about helping children learn about this subject, and the next stage for us is to work with them to develop enhanced materials to add to our education pack to support teachers in delivering vital lessons on this very important subject.”