Secondary schools urged to introduce financial literacy as standalone course as traditional maths approach failing young Aussies
New research has found the current approach to financial literacy in our schools is failing teenage girls and recommends that it be taught as a standalone course instead.
Independent charity Financial Basics Foundation in partnership with Suncorp Bank commissioned the research by Griffith University to investigate why young women have lower levels of financial literacy than young men.
The Financial Literacy of Young Australians report by Dr Laura de Zwaan and Dr Tracey West highlights six key recommendations for secondary schools to improve their financial education.
The report's authors said: “An extensive number of studies have found females outperform males overall in high school, outnumber males in university, and are higher qualified in the workforce.
“However, there remains consistent evidence that women, and in particular young women, have lower financial literacy levels than men.”
#Summary of report findings
Financial literacy education should be elevated within high schools, ideally within a standalone program.
The delivery of financial literacy education in Maths needs to be improved.
The delivery of financial literacy education should be expanded to subjects outside of Maths and Business.
A range of assessment methods should be offered to students to enable them to show what they have learnt.
Learning activities should be aligned with the general level of financial experience of the students.
Students need more exposure to effective financial strategies, in particular moderation (or control) of spending for saving.
While some students were aware of financial concepts such as interest, inflation, investing, insurance and superannuation, most had little or no knowledge and/or understanding of how they translate to personal finance.
The research also found there were clear gender differences in confidence in financial knowledge, with girls generally having less confidence than boys. Girls tend to take a more collective approach to finances, where they consider others when making financial decisions.
Despite the introduction of content and specific opportunities to develop financial literacy in two Australian curriculum learning areas (Mathematics and Economics and Business) in 2014, the research revealed that many students, especially girls, found the maths-based approach to financial literacy was a barrier to learning these essential life skills.
“For many students, maths is not the most effective curriculum area for learning about personal finance,” the authors concluded.
“There is evidence that curriculum structure and delivery in Mathematics often results in students fixating on formulas and calculations, without understanding the underlying concepts. Many students are disengaged (resulting from a range of factors) with maths.”
The research concluded that storytelling was likely to be a more effective way to learn about personal finance, and context was critical for understanding financial concepts.
“It is important to match the learning activities with what the students are experiencing, and to use real life scenarios,” the authors said.
“Whatever students do learn about money and financial concepts, occurs predominantly from home, maths, or business studies.
“Home life can have a huge impact and the students we spoke to were incredibly diverse. There is significant variation in the structure of their households, with many not living with their parent or parents. There is also evidence of parents not being able to provide financial guidance.”
We want all young Australians to have a secure financial future and a clear understanding of the strategies they can employ to achieve that.Financial Basics Foundation CEO Katrina Samios
Financial Basics Foundation CEO Katrina Samios said the research further highlighted the need for all teenagers to learn more about personal finance and money management as a safe path to financial security.
“There is evidence that knowledge and awareness of effective financial strategies is actually going backwards, despite financial literacy education being addressed in the Australian school curriculum," Ms Samios said.
“This is a significant concern and the Financial Literacy of Young Australians report should be a wakeup call for governments and educators.
“We want all young Australians to have a secure financial future and a clear understanding of the strategies they can employ to achieve that.
“Consistent with this report’s recommendations, we are calling on governments to introduce financial literacy as a standalone course across all secondary schools.”
Suncorp Bank CEO Clive van Horen echoed the recommendation to introduce financial literacy as a standalone course.
“A standalone course based on managing personal finances not only helps teach young Australians how to make good financial decisions, but it supports their financial and mental wellbeing, knowing they are working towards a financially secure future," Mr van Horen said.
“Not enough emphasis is put on this important life skill in schools and more can be done. As a father of three teenagers, I understand some of the challenges kids experience navigating their way through life. More can be done to build their financial wellbeing skills in schools.”