For many people, money management is a skill that's tricky to grasp. The lack of formal education on the matter means that many will enter adulthood with little understanding of budgeting, savings, mortgages and household finances, which means that their bank balances could be adversely affected – and many would have welcomed proper teaching on the art of money management as a result.
Research from NS&I shows that over half (52%) of respondents who feel "out of their depth" when it comes to money management have never received formal financial education but would like to have done, and the same is true for 36% of those who feel confident managing their money on a day-to-day basis.
It was also found that 52% of those without any savings, as well as 58% of those who don't save regularly, had never received suitable education. Overall, 45% of respondents have never received formal financial education, and even among those who have, just 36% said they got advice about the importance of saving.
This shows that "millions may be struggling without a basic knowledge of money, savings and how to plan for different life stages," said Jill Waters of NS&I. "Getting a good understanding of personal finance will help people make more informed decisions."
According to the survey, the key topics people want to learn about are budgeting (55%), the importance of saving (33%) and how to plan or save for retirement (31%). At the other end of the scale, the topics deemed least important are making a will (13%), understanding benefit entitlements (9%) and handling redundancy (4%), despite the fact that these could be scenarios that require even more guidance.
There are certain aspects that people find particularly complex – 27% of respondents said that investing in stocks & shares is the most complex aspect of personal finance, while 11% struggled to understand how they should plan and save for retirement – but the right kind of education could make a lot of difference, with 25% believing that it would have helped them save, while among those who have received such education, 12% said it's helped them on the road to becoming smarter savers.
It's perhaps unsurprising that so many people are calling for this kind of learning to be incorporated into schools: only 15% received financial education for the first time at secondary school, but the overwhelming majority (87%) think that school-age children should receive some form of financial education to set them up for the future.
But just who should be providing that kind of education? Well, over 40% believe it should be down to school teachers, while 24% think it should be instilled in children by parents or other family members, something that could arguably be easier said than done, given how many adults admit that they find money management difficult to grasp.
Happily, this doesn't mean that people are averse to asking for help – while 36% would speak to a family member about a financial matter they didn't understand, 24% would seek professional advice, and 21% even think that children should be able to learn about finances from professionals.
Jill Waters agrees with this method and suggests that people "do their research when it comes to making a financial decision [and] speak to a trusted adviser if appropriate", and if you can, try to educate yourself about key financial matters so you're better able to cope with anything that could come your way.
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