Lessons in Budgeting for Youngsters
An all-party political group is to be formed to support schools adopt personal finance lessons into the curriculum to prevent the next generation becoming burdened with debt.
The AA Financial Services welcomes the formation of the group – Financial Education for Young People (FEYP)- to help young people understand how best to manage their money, such as savings, borrowing, credit cards and bank accounts.
Research by the AA showed many of those aged 18-22 years old have little knowledge of personal financial terms.
“Too many people get into financial difficulties because they don’t know how to handle their money properly,” said Mark Huggins, AA Financial Services director.
“If it were part of the national curriculum I’m certain that future generations will be much less likely to make the mistakes their parents might have made.”
The AA study revealed 55 percent understood what AER (annual equivalent rate) meant, while some mistakenly thought it was a Government earnings measure. Others thought it was a European air traffic control abbreviation.
Nearly three-quarters knew what an ISA was, although those who did not though it was a unit of metric measurement, or an iPhone app.
While 57 percent of youngsters have savings, 46 percent have no idea what interest their savings are earning, and 33 percent admitted they had never checked to find out.
Manage Your Money and Budget with a Prepay Card
TheNeon Prepaid Card is a MasterCard aimed at the under 18s market, offering young people the means to load their money onto the card to help them budget.
There are no transaction fees or monthly charges so the user will not lose money for making purchases.
Once their funds have run out, the card does not allow the user to make anymore purchases until more is loaded onto it, so there is no way they could get into debt, just the ability for them to manage their money to make it last.