I have the opportunity to teach Year 8 children about financial literacy, what do you wish you’d been taught at school?
Posted by Formal-Factor8551@reddit | AskUK | View on Reddit | 192 comments
As above. I teach in a school in England and I will be teaching business and finance. What do you wish you’d been taught in this subject?
TSC-99@reddit
Pensions
YouWascallyWabbit@reddit
To 13 year olds?
bars_and_plates@reddit
It can be explained easily, the issue is that people tend to overcomplicate it.
A pension is just putting money away now to have it later.
If you work for 40 years and save 25% of your income, then basic maths tells you that when you stop working you will have 10 years of income saved.
That is a pension.
The main differences between this simplified model and what actually happens are tax advantages and investment returns.
But in school we don't teach any topic like that anyway, you learn the simplified model, and then later on you get told that actually no, Physics doesn't work like that, because we left out this bit to make it simpler to understand initially.
Racing_Fox@reddit
Yes.
I’m 26 I can’t count the number of times I’ve been taught about budgeting etc.
I’ve never once been taught about pensions and quite honestly still don’t really understand them. I think I’ll get a set amount per year when I retire but until I get there and find out I won’t know for sure
Draenogg@reddit
I'm 35 and I also have absolutely no idea. To be honest I'm working on the basis that we'll all be living in a post-apocalyptic wasteland by the time I get to retire so it's moot point.
YouWascallyWabbit@reddit
But would learning at the age of 13 have helped though? You've had the whole internet for a long time, why would a couple of hours from your pshe teacher 20 years ago have helped? I'm older than you, I don't know about pensions, and it's my fault, not my school's. Schools can't be responsible for teaching everything we need to know in life. "Don't spend over your budget, and don't borrow too much" for me, is a good enough starting point and there's a chance it might stick in someone's brain.
YouWascallyWabbit@reddit
I'm old enough to know better but don't know much about pensions. If I'd been told when I was 13 I wouldn't know. They need to be taught what they can understand, things that feel relevant to them. There's a lot of financial literacy that's relevant to 13 year olds that they're more likely to understand and retain. People should know more about pensions but trying to get that information into literal children doesn't feel like the way to do it.
Racing_Fox@reddit
13 is only 2 years off their GCSEs, give them some credit aha
YouWascallyWabbit@reddit
My son is 13. I've spent time with 13 year olds and had good conversations with some of them. Even from 13 to GCSE age is a huge jump in development. I'm trying to teach my boy how to manage his pocket money and his much a mortgage is per month and that's why we have jobs.
And something as abstract as "this is how you'll live when you retire" is completely different to "this is how you regurgitate history facts in order to pass an exam".
OurSeepyD@reddit
I don't think they're massively complicated, but I'm sure someone will give me a reason to change my mind.
There are two main types of pensions: state and private.
State Pensions
State pensions are essentially like a salary, you get £x per month. To qualify for this, you need to have worked for a certain amount of time. You can qualify in other ways, e.g. by claiming child benefit.
Private Pensions
A private pension nowadays is typically just a pot of money that you pay into that's very tax efficient (i.e. you generally pay 0% income tax on what goes into it). Employers are also incentivised to pay in extra money. When you retire you'll hopefully have hundreds of thousands of pounds ready to go.
With that pension pot, you can either take that money directly as income until the pot runs out, some of which is tax free, or you can buy an annuity which is just a word for "income until death". Online calculators can estimate how much a pot of money would give you every year/month.
There are many nuances to all of this; tax implications, qualifying years, changing pension ages, investment returns, inflation hedging etc, but I think the essentials are described above.
recchai@reddit
For private 'defined contribution' pensions, you save up into a pot, which is invested so it increases in value, and because as a pension, you know the money is going to be there a long time.
When you are old enough, you can take this money out. Lots of pension saving schemes have a lifecycle element, where they gradually invest in less risky things in the run up to you retiring. You don't want to lose everything just before retiring.
There's stuff about being able to take out lump sums, but who knows what the rules will be when you retire.
With your pension pot, you can either draw down on it, or you can use it to buy an annuity. Money saving expert is usually pretty good for this sort of thing.
NoEquipment7363@reddit
You can have a junior SIPP at 16 and receive tax relief, so that’s only 3 years later. it’s never too early to teach kids good financial habits.
JammyWaad@reddit
I remember an exercise we had at school around the same age where you wrote down all the things you’d buy yourself if you were an adult. Most people wrote big house, nice cars etc then after we were given a piece of paper each with different everyday jobs and their average salary. Then you’re asked to work out how you’d pay for it all with the job you were given.
Not sure if it helped or not but it is a lesson I remembered after 20+ years so I’ll give it that.
bars_and_plates@reddit
This actually sounds fantastic. If it would put even one person off from going into a career (e.g. banging 5+ years of A levels and university etc) that will never pay them enough to get what they want it'd be worth it for that reason alone.
20dogs@reddit
I think this is a better and far more realistic idea than the others. Imaginative and teaches a lesson.
notthatbluestuff@reddit
Stocks and shares. Investments in general. Mortgages and how they work. Interest rates.
YouWascallyWabbit@reddit
These are Year 8 children, so aged 12-13. Based on my kids "don't buy shit you can't afford" and "credits cards aren't magic" is about the level most kids can comprehend.
notthatbluestuff@reddit
That’s the kind of attitude that prevents schools from teaching it. “Whatever, they don’t understand it so why bother?” Any subject can be presented in a basic manner to serve as an introduction - perhaps leaving kids better off in future. I certainly wish I’d learned more about it when I was younger.
YouWascallyWabbit@reddit
I think there's a lot of financial literacy that can be taught at that age. But if any of it is going to stick, it needs to be relevant. I don't think stocks and shares are something that works at that age - they can't apply it for years, for one thing.
There's a general perception that "this stuff isn't taught in schools" - maybe it isn't enough, but it is taught, in PSHE, in Maths. But it doesn't stick. Because it makes no sense to them at that age. Teach them things they can understand and they'll remember. What do 13 year olds need to know about stocks and shares? We tried explaining the concept of a sharesave scheme to our 13 year old. It makes no sense to him, he has no context to apply it to. Let people who want to do that stuff learn about it. There's more useful, relevant stuff that this limited section of the curriculum should be used for.
bars_and_plates@reddit
Right, because this is a really convoluted example.
Kids can understand "buy a bar of gold for 100 quid and it will probably be worth 125 quid later", or the slightly more complicated "buy a percentage of Apple and it could be worth more later".
At 13 I was buying and flipping items on online games which led directly into me realising that if you just don't spend money you can basically multiply it forever whilst everyone around you buys endless tat.
Racing_Fox@reddit
Gotta be careful to not accidentally give financial advice tough
Karl-Pilkinghorn@reddit
Buy high, sell low!
bars_and_plates@reddit
I don't wish I'd been taught this because I figured it out for myself, but -
Savings, investments, business.
More specifically, that the entire goal of your working life is to give yourself optionality / free time / ability to retire if you wish.
Almost everyone in the UK outside of a tiny elite just sort of spends all of their money and assumes that they absolutely must work full time until they are physically incapable. The extent of their savings is usually, maximally, physical artifacts like a car, or buying the biggest house available and putting all of the money into it.
The idea that e.g. if you earn 20% more than your neighbour you literally can just save all of it and then work 20% fewer total hours in your lifetime just passes most people by somehow.
Cheap-Vegetable-4317@reddit
Credit card/loan agreements and terms and conditions, understanding interest.
Where to find help if you get into arrears.
How to read a pay slip.
How to do your own tax return as a self employed person and taking out liability insurance as a self employed person.
How to do a budget, writing things down to keep track of spending, using cash to keep track of spending.
How to recognise scams and scammers.
Financial abuse in a relationship.
Cheap-Vegetable-4317@reddit
That last one isn't something I wish I'd been taught, I just live near a betting shop.
Manky7474@reddit
People in the comments thinking this will work lol. The kids are 12. Mortgages, lifetime isas, pensions - they are not going to dare or take this in. The best you'll be able to do is a bit of budgeting and maybe student loans.
Everyone acts like financial literacy at schools is the answer but they're too young to learn this and take it in. How do i know? I've been teaching 15 years old this for years in PHSE
rtrs_bastiat@reddit
How debt can spiral out of control
TheDarkestStjarna@reddit
Budgeting.
Naive-Interaction567@reddit
Yes. It’s so simple but surprisingly hard. £400 can feel a lot £12.90 a day isn’t very much. Learning how to budget and break down spending is important.
External-Pen9079@reddit
This is exactly what worked for me with budgeting! Although I was almost 40 before I got it! 🙈😂
tomwaitsgoatee@reddit
Came here to say this so commenting here instead. I didn't learn to budget until my mid 30s and it's made the world of difference.
Woffingshire@reddit
How the tax brackets actually work.
As in, that you get taxed the higher rate only on what you earn over the bracket for that rate. It wasn't until uni that I found that out.
Mundane-Topic-8214@reddit
Teach them to read terms and conditions on something like a credit card agreement and understand what they would be charged, ie, you spend 500 on your card, you pay the minimum (what is that?), if the APR is 29% then how much interest will you be charged on your outstanding balance? You only pay the minimum for the next five months, how much do you now owe?
BlokeyBlokeBloke@reddit
So, compound interest. A thing that is already part of maths
Mundane-Topic-8214@reddit
Yes, but in an applied sense.
BlokeyBlokeBloke@reddit
https://www.bbc.co.uk/bitesize/guides/z9rjxfr/revision/6
Like this?
Mundane-Topic-8214@reddit
Yes mathematically but ground it in reality by having them read the terms and conditions to identify the relevant information and then apply it. The number of people who seem incapable of applying mathematical principles to actual real life information they are given is shocking.
Etheria_system@reddit
This is a bit heavy for year 8 - they’re only 12-13 years old. You’d struggle to get adults to sit and read terms and conditions
Wishmaster891@reddit
thats on them then, shouldn't have to spoon fed
CF_Zymo@reddit
What do you suppose the function of school is, O Wise One?
Mundane-Topic-8214@reddit
Because heaven forbid you try to educate people...
BlokeyBlokeBloke@reddit
You don't read the terms and conditions to find the interest rates.
Careless_Soup_109@reddit
Modern day: teach them to prompt AI to do this.
Cornelius-Figgle@reddit
Ah yes because teaching kids to trust AI for financial advice is a great idea
WinglyBap@reddit
I know this is better than nothing but year 8 is 12-13 year olds. I’m not sure this will sink in to them
Mundane-Topic-8214@reddit
Depends how you teach it, as with anything at school.
Worth_Kangaroo_6900@reddit
Yes please! Wish someone had taught me this. Learned the really hard way at 21.
boobiemilo@reddit
Absolutely this, compound interest.
BlokeyBlokeBloke@reddit
https://www.bbc.co.uk/bitesize/guides/z9rjxfr/revision/6
cryptonuggets1@reddit
Second this. Props if you do it soprano style, points and vig 🤪loan shark style to exaggerate it
LungHeadZ@reddit
Excellent suggestion. Wish I had been made aware back then. Payday loans after turning 18 was a nasty shock, learned the hard way.
Scared-Room-9962@reddit
Payday loans...
About 15 years ago I got one. Then another. Then another.
On and on it went.
I would get paid and my account would be empty.
I'd get loans to pay off the loans I still hadn't paid and then reloan to get by for the month. By get by I mean buy drugs.
Took me a while to sort my self out and clear this all down.
Strangely I have a great credit score lol
One of the companies, txtloan, would charge you £5 for a failed payment. They'd try the payment multiple times a day, knowing it would fail.
I did get a £800 refund of Wonga towards the end of the whole thing .
KingKhram@reddit
Live within your means and never be in debt, mortgage and similar deals are acceptable to the rule
Radiant_Chart3163@reddit
I wish I had been taught about saving accounts and ISAs.
cubesnack@reddit
Explain how cryptocurrency works and how fiat currency is different from crypto. Explain that a lot of social media content they watch is somewhat sponsored (either blatantly or covertly) and that everyone is trying to sell them something - always. Also important - how scams are perpetrated, what the common types of scams are. And how they need to avoid the easy money and not become money mules as that will screw them up for a very long time or even for life.
Street-Ad-7566@reddit
The power of compounding and how importsnt it is to start building their pension pot.
Gouldy444444@reddit
Definitely investing. Look at how rich you would be putting the £5 a week pocket money from the 90s in the S&P rather than sweets and cigarettes. They won’t listen cos teenagers but it’s worth a shot.
20dogs@reddit
Also because not allowed to open ISA
Melodic-Tutor-2172@reddit
Compound interest (you pay interest on interest), wage deductions and how much they will be. The importance of a lifetime ISA before 40.
5c0ttgreen@reddit
The lifetime ISA won’t exist soon. This is why teaching this sort of thing at school is largely pointless because no one knows what will be available in 10/20/30 years when these kids need to know it.
Melodic-Tutor-2172@reddit
Then teach them the equivalent. My colleague bought a house and his savings were topped up by the Government. If there is any anything as useful as that it is worthwhile baking kids aware. They could stick a fiver in to start.
5c0ttgreen@reddit
Ok Nostradamus, what’s the equivalent going to be in 20 years time?
Melodic-Tutor-2172@reddit
Didn’t say I knew 🤷🏻♀️
5c0ttgreen@reddit
My point is no one knows so how are you going to teach it?
Goldf_sh4@reddit
This also applies to science, geography etc. We teaxh it the best we can.
5c0ttgreen@reddit
Perhaps you or I have misunderstood each other but I am saying there’s no point in teaching kids about LISAs because they won’t be available for long and it’s impossible to know what will be available when it comes to them buying a house.
The fundamental laws of science remain constant. Water is made of hydrogen and oxygen, ‘twas ever thus.
Content-Violinist613@reddit
Seems like a lot of extra admin and constant changing to a curriculum for something that kids can easily find out elsewhere at a later date. Say you learn about LISAs in year 8, by the time you’ve graduated school or uni this is totally out of date and something else has replaced it that you didn’t learn about.
Goldf_sh4@reddit
You could say this about a lot of the curriculum.
BlokeyBlokeBloke@reddit
I would have been learning about endowment mortgages.
Content-Violinist613@reddit
Compound interest has been on the curriculum for at least 20 years. I learnt about it in Y8 maths in 2006/07
Melodic-Tutor-2172@reddit
I was at school in the 90’sand didn’t learn this.
Content-Violinist613@reddit
Ok, cool
EntrepreneurAway419@reddit
In real terms, relating to pensions and savings and what that will mean for retirement, buying property, financial freedom.
Content-Violinist613@reddit
To 12 year olds?
EntrepreneurAway419@reddit
Why not? They teach about businesses and finances like Young Enterprise. You can introduce them as ideas, if it sticks with one person then it's a win.
BlokeyBlokeBloke@reddit
That is covered in mathematics.
https://www.bbc.co.uk/bitesize/guides/z9rjxfr/revision/6
5c0ttgreen@reddit
Yeah a lot of people neglect the fact that most of the skills needed to be financially literate are already taught at school.
CodeToManagement@reddit
It’s not about the math it’s about the context and how to apply it which kids need to understand. And tbh getting them to think and plan.
BlokeyBlokeBloke@reddit
It's done in the context of both saving and borrowing money.
Goldf_sh4@reddit
-How to calculate credit interest and debit interest -How compounding works with pensions savings -The different options for investing and how investing works -How pension savings work -Why buying things on credit cards/car finance can be a bad idea and the extent to which opportunities to collect debt will be effectively marketed at you and normalised once you're in your late teens/twenties -How to use a spending-tracker website -How important it is to keep 4-9 months expenses money saved in easy access accounts as a safety buffer -How mortgages and mortgage interest works
TheThingwithTheFeath@reddit
False-ish advertising. Sure, this bank has no foreign currency conversion fee, but they have a worse exchange rate so you are actually paying the same thing. Also, how uni loans work, and when it’s a good idea to take them out. (Spoiler: most of the time for people after 2020ish)
Curious-Ad-527@reddit
Store cards and the curse of them. Yes at 18 its fun to get everything on credit, still paying them all of at 23 when you need a mortgage or a loan for something important, not so fun.
Consistent-Pirate-23@reddit
I was in year 8 in 1993 so I am probably a bad example
Mortgages- what they are and how they work
Loans- including how the interest works and why payday loans are so high interest
Credit cards
Budgeting and saving
How bills are calculated for gas/electric etc
I know some will say parents should teach that but they can stfu. As long as kids learn from someone then I don’t care
Pitiful_Oven_3425@reddit
Inflation and how money depreciates
CardinalCopiaIV@reddit
Investing in stocks and shares ISAs, investing in a SIPP
Lyrakish@reddit
Short term pain, long term gain. Missing out on some fun things now to mean you have savings later, which grow over time.
Acrylic_Starshine@reddit
Banking, interest, mortgages, retirement pots, credit cards, fraud.
NotSoSleepyBoy@reddit
How tax bands work
Suspicious_Banana255@reddit
Mortgages and pensions
NotSoSleepyBoy@reddit
The power of compound interest
OppositeWrong1720@reddit
Budgets - paying essential bills first, saving towards an emergency fund. Micawberism
Buying on credit - why this a bad idea. Depreciating assets eg cars
Getting National Insurance credits. Pensions
Investments - Tracker funds versus shares etc.
HotButteredBagel@reddit
The impact of having a credit card. The interest payments for those impulsive purchases until you’re living like a hermit because all your money now goes on interest payments. It’s a house of cards that could fall down any time.
Electronic_Law_5295@reddit
Omg! I have the perfect resource for this we've used it for all the years. I made it though so I'd have to email you.
1.Get them to research some jobs they're interested in and write down salaries for entry and expert level
Use a take home pay calculator online so they can see their monthly income
Use rightmove to find a property they can afford to rent (buying is too complicated for a lesson and the rent should be less that 50% of their income)
They go to an online supermarket and make a shopping list for what they would need for a week and then you can work it out for a month
I have a budgeting spreadsheet they can fill in and you can teach them formulae to calculate what they have left
Then they can calculate savings over time and you can tell them about direct debit for important things and good money skills
We usually have a drop down day to do this and depending on the year group it can be all day. For older years we talk about mortgages and student loans because they're quicker and we have time. This could be a whole week for y8.
Also all the major banks have resources for schools on their websites. They're good but tbh we tried them and it's not as engaging as them working with what they think they would actually earn + the numbers can be unrealistic like £300 for rent like sure... 😅
Hope this is helpful! I really enjoyed running this
DarkStanley@reddit
Teach them about investing.
iamsheena@reddit
Please spend time talking about online purchases including the value of in-game purchases. Also, a lot of money now is not tangible, so keep in mind that teaching financial literacy the same as 10+ years ago is not as relevant today.
bouncypete@reddit
This is a very large subject.
However, as someone who is about to retire. The very basics of a pension would be useful.
I'm ok, I've taken professional advice.
But so many people of my age have simply no idea.
Some people haven't been saving enough.
Others have no idea how much they have got and seem to be intending to work far longer than they need to be. As a result, they'll probably be the richest person in the graveyard.
Mission-Sound9493@reddit
The joys of compound interest.
5c0ttgreen@reddit
Do teachers often ask strangers on the internet what they should teach?
Isn’t there a curriculum for this sort of thing?
NoICantShutUp@reddit
Not only is there a curriculum and plenty of lessons available online, pretty much everything mentioned here is taught already and has been for at least 15 years....
PetersMapProject@reddit
One of the little things that's frequently misunderstood is how tax works.
Specifically, you only pay the higher rate of tax on the money over the threshold, not the whole wage. I've heard of people turning down pay rises because it would take them into a new tax bracket and they're convinced their tax bill will go up more than their pay.
Munchkinpea@reddit
They also need to know about the personal allowance and NICs.
An understanding that as an employee on PAYE these things will be deducted automatically so it doesn't come as a shock that a salary of £24k doesn't mean they will receive £2k per month.
And also an understanding of when a tax return might be needed.
bsnimunf@reddit
Income tax, national insurance, mortgages, inflation, pensions, interest rates, credit cards, compounding, stockmarkets.
DiskBytes@reddit
Teach them how it really works. Get a group of them together to perform a task and sit some in a corner doing nothing. Then pay the people who worked. Then show them that you're now going to take money from those who did the work and give some of it to those who did nothing.
That'll explain tax to them.
Asaxii@reddit
Please update us on how it went.
rattlinggoodyarn@reddit
How debt is like fire. If you use it well you can make delicious food but fuck around and you get burnt.
How to budget and job hunt for the lifestyle you want. Not the dream but the reality. Get them to create an actual budget of their personal lifestyle.
Sharp_Budget_4416@reddit
How pensions actually work, and specifically the power of starting at 22 vs 32. Show them the compound interest curve side by side and they'll never forget it. The other one I'd push hard is "lifestyle creep". The moment you earn more, your spending tends to quietly rise to match, and most people never set up the habits to save the difference. Teach them to automate savings the day their pay rises land, before they've mentally spent the extra.
SchoolForSedition@reddit
Not Year 8 but I taught university law students for 20 years.
I taught land law, which in England is a bit wonderful. But every year I said we will now have ten minutes in how repayment and endowment mortgages work. It’s not in the syllabus and it’s not examinable but everyone should know especially law students.
Many students understood a quasi-scam and several how to make a lot of money with one short focused letter.
My life advice: never buy anything you don’t understand.
Adorable_Orange_195@reddit
Budgeting Food shops and how sticking to a shopping list and always eating before you go shopping helps avoid unnecessary/ unwanted spending. The importance of saving at least 1/3 pay & any bonuses or pay rises, before you get used to living on that salary Delayed satisfaction- not buying as soon as you see something you want, adding it to your cart or taking a pic of it in a shop so you can go back in 24-48hrs if you still want it. ISA, LISA’s etc and how they can give me more money towards a home, tax free etc. Ensuring to build up and keep a 3-6month emergency fund in case you lose your job etc. How much it tends to cost to run the average home & bills incurred ie council tax, tv licence etc. Mortgages and how they work and how interest rates can hugely impact how much you pay. That you need to save roughly 10% of the property value annually towards any future repairs ie electrics, boiler, roof repairs Pre planning holidays - by booking in advance you may pay a little more but this allows you time to pay it off rather than having to pay it all over a shorter period. *Why certain types of lenders are problematic and need to be avoided ie loan sharks, pay day loans, log book loans, non-compliant equity release companies, lenders with poor service/ high fees, guarantor loans and the red flags associated with these.
JDorian0817@reddit
I did this lesson this week! How much money they will save on their own in five years. Compare it to how much money they could save with a rich uncle paying them interest every year.
Also how to tell the difference between essential and luxury purchases. What needs to be prioritised when budgeting. Why budgets are important. Why pensions are important. The difference between good debt and bad debt - but why even good debt (mortgages, student finance) can be insanely expensive in the long term.
Perpetua11y_C0nfused@reddit
Teach them to understand the breakdown of a payslip.
Used to hire a lot of entry level people who didn’t understand the difference between gross and net.
EntrepreneurAway419@reddit
Things I've had to teach my 38yo brother in the last 2 weeks - just before financial year end - what a cash ISA is, S&S ISA, premium bonds and high yield savings accounts and SIPPs. More importantly why, as a self employed person, or anyone, shouldn't have 100k in savings just sitting in their current account. His business has just done fantastically well in 18mo and he didn't know what to do with it.
From a previous job - how gas/electric works, just because you have a direct debit for £60pcm, doesn't mean your account won't go into debt. Different ways of payment and what they mean DD, variable DD etc...
For my past - why even 0% interest overdrafts are a bad idea, credit cards, why buying stuff for stuff's sake is a bad idea, how much little things add up like coffees or lunches out when you could bring things from home, you don't necessarily have to follow your parent's financial lead. Also a message about not following others, comparison is the thief of joy etc, not necessarily your job but relevant.
Theallseer97@reddit
Being taught how to access council related things. How to set up bank accounts, pay bills, etc. schools seem to assume parents will teach this and not everyone (like myself) had this. Thankfully I went into care and my support workers/social workers taught me all I needed to know about actual adult living in terms of finances. Personally I think it should be mandatory to learn about money and finances in school. It's just as important as learning core subjects.
Vast-Faithlessness85@reddit
Interest / inflation / investing (stocks and shares, bonds ETFs etc) / pensions / credit ratings.
Maybe some basic stuff like reading statements and different financial documentation.
PickleFridgeChildren@reddit
Recognizing when someone is just trying to sell you something. Seeing how things like adverts try to create pressure to buy something you don't need.
Odd_Championship7286@reddit
This is a great one, especially with TikTok shop etc shaming kids for not having the latest and greatest piece of crap that won’t be cool anymore next month
Tattycakes@reddit
However the cat beds are awesome
peppermint_aero@reddit
Great advice, especially at the age where they'll be starting to think about clothes, makeup, hair products etc
Intelligent_Put_3606@reddit
When shopping for food or drink, to compare prices per 100g or 100ml - so the bigger pack might not be better value.
How to budget
The importance of saving both for retirement and short-term goals
incredibubblez@reddit
I can't believe I had to scroll this far for this comment. The times I have to get my 12 year old to look at the £/KG as opposed to the cost to the packet.
Familiar-Ordinary275@reddit
Investing, pensions, and the importance of starting early to reap the benefits of compound interest. Compound interest is also normally taught as part of maths so learning how to apply that to a real life example to illustrate the important of starting early.
summers_tilly@reddit
I learnt what an ISA was when I was 35. I went to a really good school but we were taught no financial literacy. My parents were refugees on minimum wage so knew nothing themselves. If I was teaching a year 8 I’d be hammering what an ISA is and the magic of compound interest.
Fine_Analyst_4408@reddit
Read your gas and electric meter when you move out/in to a new place so you don't get charged for the new/previous inhabitants usage. Had to fight my electricity company for 6 months for an £800 bill that wasn't ours. Maybe not exactly what you're meaning but certainly something I wish I'd known and that nearly severely affected my finances.
MerkinMites@reddit
Why, why do people buy "sale" items on credit cards then pay ridiculous interest payments to their lender. Learn the value and peace of mind of financial solvency.
Credit for anything non-critical is mostly a poor investment on your present and future. 'Debt slavery' is a term worth associating with credit.
Mammoth-Passion-413@reddit
But if you are savvy you do it for 2 reasons.
I personally use Currys Flexpay - not because I can't afford it - but because it's always BNPL 12 months and it's always paid off - also as stated above. it's their money and not mine until I pay it off. That said I have a 35K credit limit with them.
Consumer protection is the name of the game here.
MerkinMites@reddit
You're right to correct me. My only concern is that a majority of people don't pay above the minimum amount due and that is how you accrue a poor return on your initial material investment.
carpet_tart@reddit
Credit, it needs explaining in full, whether it be cards or klarna/payday loans. Basics like budgeting for a monthly cycle of direct debits and the importance of an emergency fund
maceion@reddit
Teach them to do a weekly budget as a basic thing. for themselves, for a house hold family of four , for a single parent and child.
sparkline1234567@reddit
That buying stuff second hand is financially prudent, environmentally responsible and fun!
AngryTudor1@reddit
Teacher of 20 year experience who has done this with all age groups.
Yes, they want to know about finances
But they really do get bored quickly if its not age appropriate or age relevant.
They are always interested in what comes in the next phase of their lives. So save the detailed stuff on mortgages, investments and pensions for sixth form.
Year 8 will want to understand what those words mean, but get bored with too much detail.
They will want to know about their next phase - bank accounts types, card types, what the numbers mean, what numbers to keep secret on your card, avoiding scams online etc.
Their next phase might be getting a part time job in a few years. They will want to know about minimum wage for their age group, what the deductions might be, national insurance, how much they have to earn before they pay tax and what kind of taxes people they might be working with and their parents will pay. What might be on their wage slip. What student loans are and how interest works across finance.
Just-Standard-992@reddit
Compound interest. What an ISA is. How mortgages work. How tax brackets work. I reckon that sets anyone up for life
perhapsflorence@reddit
Financial abuse or manipulation.
JustTom88@reddit
How tax works, tax bands, marginal tax rates, and pensions!
VreamCanMan@reddit
Compound Growth, basic mathematical idea, how it applies to debt & investment; calculation
Basic savings best practices - annualised payments instead of monthly,
Dont do mortgages fully as its a five factor model which is a bit advanced (proper analysis relies on projected upkeep, oppertunity cost, interest rates, leverage , housing asset Growth). But stick to simply the interest side of the question, talking about fixed and variable rate mortgages.
Oppertunity Cost & Investing, how money can make more money historical norms (e.g., stocks avg. 5.5%, bonds 3-4% regionally dependent).
Asset Inflation - how assets and housing are all connected in an economy (all used in investment portfolios), why assets have outgrown broader economic growth and how highlights wealth inequality and lowered social access.
Also make it make economics more tangible to the average learner. Show them how in all the little mundane ways interest rates, government debt, industry policy etc. effects them
CellistLow8857@reddit
Why starting a pension early is important!!!!
Also just savings in general, why it’s important to have them, and how to start saving.
As a kid/teenager living at home these things seemed so unimportant to me, they were such abstract and distant concepts, and then once I started earning money there was no way I was giving any of it up to some hypothetical future problem. I wish I’d started thinking about it all so much sooner!
VillageHorse@reddit
I’d probably start by them understanding how the state pension is funded. Terrify them into the “hang on, what about when I’m old?” question, and reveal the solution as saving early into their own pensions and receiving the benefit of compounding over time.
escapingfromelba@reddit
Honestly, loads of people were taught what they'll write out in the comments. The issue is that kids aren't ready to hear the message so they filter it out as it's too abstract.
Midget-muncher@reddit
What the bits of your payslip mean
BlokeyBlokeBloke@reddit
For a 12 year old?
Midget-muncher@reddit
Wish I'd learnt early
Great-Activity-5420@reddit
How to mend clothes and household items. Basic stuff like insurance and savings would've been great. Basic cooking not the stuff they actually taught. I feel like they taught me a lot of stuff but nothing that I actually needed for life
TraditionalScheme337@reddit
How are payslip works! Just the basics but as a payroll consultant I see so many really basic questions and misunderstandings from people. I remember thinking and asking similar things as well.
controversial_Jane@reddit
I did a week in my kids school where parents came to teach maths in our career subject. One guy did maths in field navigation as he’s in the army? I did maths in medicine and another parent did nutrition. Kids loved it, maths is used in so many fields and it’s not just money matters.
Mammoth-Passion-413@reddit
My 7 and 10yr old have been taught and shown this - and manage their own bank accounts. This and how to cook gohand in hand - my neighbours are skint all the time as she can't cook and so they have take out EVERY day - and I mean EVERY day - 3 times a day. must be spending 5K a month based on the evidence i've seen.
CodeToManagement@reddit
For me I would have really liked people to teach like the outcome of saving as I always thought it was pointless when I was young.
Like when kids can’t work part time and you only get pocket money why should i save anything. If I get £10 a week and I save 20% that’s going to put £ 100 in my bank account over a year
Let’s say I get 4% interest a year great I made £4. The next year I do it again now I’ve saved £200 and I’ve made £8-12 in interest.
What’s the point and when does it pay off because compound interest is great but for all that saving it’s only benefitted me by a £12 raise over 2 years.
Showing how it actually does start to pay off and the point of it is basically build habits and have savings which don’t get touched for a long time can have huge effects
Plus talking about things like investment would be interesting and how long term they can outperform savings.
But also I’d recommend approach it from a kids point of view. What always lost my interest as a kid is people just saying save money but not realising that to me buying a dvd takes 2 weeks to save for. For them it’s an hour of work.
Electronic-Bus-5350@reddit
How to save. How tax works. Pensions. Bills.
PetersMapProject@reddit
The best financial lesson kids can have is to give them pocket money. That way, they learn about spending and saving when the question is trivial stuff like sweets this week or save up for a new toy in a couple of weeks. But that is outside the remit of schools.
I've always been pretty good with money, but I think the big thing that no one really explained to me was stocks and shares. I only worked it out with the help of Reddit - I had no idea I could just invest in the whole of the S&P500 instead of picking individual companies.
Bumblebee-Bzzz@reddit
Compound interest/growth over the long term, how a little each month can become a lot.
rositree@reddit
This concept applies both ways too, little debt can become huge quickly. Little saving can become a great nest egg. Both good lessons.
Dry-Grocery9311@reddit
Tell them that the minimum wage is £12.71 per hour.
Get them to work out the minimum income they could live on earning minimum wage. Rent/mortgage, food, bills, savings, investments etc.
Get them to research the types of jobs that would pay £12.71 per hour if they don't build extra skills and qualifications.
Get them to work out how many hours they need to work to get enough to live on.
Tell them about the benefits cap and the minimum state pensions and demonstrate that working pays more than benefits. Demonstrate that the state pension isn't enough to live on and savings are important.
Make it as real and interactive as possible. They are more likely to listen to explanations of things like pensions, ISAs, compound interest, bank loans, credit cards etc., if it's part of a realistic scenario.
HugAllYourFriends@reddit
most parts of the modern economy, especially bigger companies, are designed to extract as much money as possible from you with as little cost as possible without reminding you of that. If they aren't making as much money as they can, other companies doing the same thing will make more money over time and be able to expand and take their market share, so even if an individual company decides to be more pro consumer, it won't last forever.
Flaky_Walrus_668@reddit
How do credit cards work?
i.e. If I buy something for for £X and pay Y% interest, making regular payments over Z years, how much did it cost me overall?
InkedDoll1@reddit
This would be mine too. I was offered a credit card at 18 and treated it like free money. Took many years to dig myself out of the resulting hole of debt.
Additional-Nobody352@reddit
This
theoneandonlyvesper@reddit
Manners and how to conduct yourself in public
SwirlUp@reddit
How tax and NI impact monthly pay. I had a conversation with a teen who thought deductions are only made when you hit the thresholds, i.e. their first payments each tax year would have no tax until they earned £13k, then following months would have 20% etc
StargazyPi@reddit
Make it fun, make it sound non-stressful.
Much of my financial illiteracy was bourne of seeing my mum's dread every time a bill came. I just assumed money was something to fear, and so I feared looking into improving my situation.
I'm fine, but I'd have been a lot more fine with a little early intervention!
OkGrapefruit7174@reddit
“Safe” ways to handle “making more money” such as lifetime isa’s, cash isa’s etc. These are useful even if you end up in a tough financial situation later in life.
Aggravating-Ant-6767@reddit
I wish the full costs of going to university were explained rather than being told throughout the whole school system that it was basically the ultimate goal and that student loans aren’t really a loan. I know year 8 is a long way off, but from secondary school onwards it was drilled into us that we should go!
TheeDeme@reddit
I delivered a lesson on this and my form really appreciated the following:
I also created a little game of 'House'. I gave them a monthly salary and three options for each topic (type of rent/travel/food/bills/travel etc). So for example, they could rent at £500, £600, or £700. I showed them the pros and cons of each house. They then picked their option and worked out how much spare they had a month once they paid everything out.
They quickly realise that to afford the latest phone, they may need to reduce costs of social activities. It really made them realise how difficult budgeting is.
Random_Guy_47@reddit
How to make a budget.
Compounding interest with an emphasis on the value of investing early.
They might touch on compounding in maths class but showing them an example of investing 300 per month from the age of 18 to retirement vs starting at 28 years old is an eye opener.
Also show how it works against you on debts.
Teach them how credit cards work. How to use them correctly and that they can a good way to build a credit score, this leads in to teaching about credit scores.
Golden rule of having a credit card, if you can't afford it with your debit card you can't afford it with your credit card either.
Inflation, what it is and how it erodes the value of your money.
Various investment options from savings accounts to bonds to the stock market. Include something about the risk and return of each. Also include taxes on savings/investments and cash/stocks and shares ISAs to mitigate those.
Having an emergency fund.
Some general guidance on spending/saving/investing X/Y/Z percentage of your paycheck.
A warning about payday loans, buy now pay later and other such stuff that exists to rip you off.
Maybe an example of person A lives within their means and puts money in a savings account, person B lives within their means and puts money in the stock market and person C is living beyond their means via credit cards, payday loans etc and how each of these people are doing 5 years later after the returns/debts compound.
The fact that (most) employers contribute to your pension and if they match your contribution this is an instant 100% return on investment.
What the consequences are if you don't make the payments on loans/car finance/mortgage etc.
GreenAmigo@reddit
Taxes and buying assets instead of working
Duanedoberman@reddit
Compound interest, intrest on intrest especially on credit cards.
Take a figure, say £6,000, and show how long it takes to pay off from a normal loan at say £200 per month. Then do the compare with a credit card balance paying £200 per month.
chincheckmcgee@reddit
Year 8 is too young to grasp a lot of the things people are commenting here
But I think something illustrating the dark side of a lack of financial literacy may be more effective. A movie or documentary about people that abuse lines of credit, or didn’t properly manage their pensions, etc
NoEquipment7363@reddit
Budget
Pension!! Yes at 18 you’re going to want to spend £100s on a night out but PUT SOME AWAY IN YOUR PENSION!
Protections
Loans/CC = NOT FREE MONEY!
Give realistic situations, average bills v wages etc.
And what jobs pay well!! wish someone had told me I was never going to be a famous actress and to actually learn something! Having to do all my exams now in my 30s to become an IFA because I’m not a famous actress!
liquidio@reddit
The time value of money
Risk and reward
The difference between real and nominal interest rates (and what real assets are)
Goosepond01@reddit
Go for compound interest and give year on year figures, compare interest to an average wage and some cool things they actually might be interested in.
h00dman@reddit
Alternative ways to calculate long multiplication and long division.
Or more generally, I wish I'd been taught maths with more kindness and patience.
I eventually managed to get my first analytics job at age 30, and within 6 years I'd worked my way up to a senior analytics role, but I spent my whole teens and twenties thinking they I was bad at maths because of where I got stuck.
Targettio@reddit
You need to start with the concept of compound interest, this should have been covered in maths by that age. But that is the crux of everything
Then you need to explain that pretty much everything to do with money is either earning or paying compound interest. If they understand that, they will understand debt racks up and why long term savings and investing matter.
Then probably something about comparing types of similar products, say types of borrowing. Why is an arranged overdraft better than a store card etc. framing this back to the initial point about compounding interest. Then types of savings, fixed term, instant access, ISA etc.
A bit on tax. Explain that most people are PAYE means there isn't much to actually do, but explaining marginal tax etc.
the-TARDIS-ran-away@reddit
The truth about debt, how fast it spirals. How DROs and IVAs arent a magic solve all. Credit ratings, budgeting, how mortgages work, how to pay tax if youre self employed. What bills look like when you move out, how many there are and how you budget for and pay them.
SufficientBox3389@reddit
how to budget for bills, the downsides of credit cards overdrafts and buy now pay later i know so many people my age (early 20s) with thousands on klarna or credit cards who just don’t seem to realise the long term impact when you can’t pay it. i also see a lot of young people with cifas markers from letting people use their accounts for fraud or money laundering because they don’t realise what the people are doing and they’re getting paid for it, so maybe about protecting your bank account and credit. not letting people use your account, put your name on anything or co signing for them
also maybe just setting them up for everyday costs they’ll possibly experience like the costs of having a child, a house, a car. different budgeting exercises with examples like you have 2 kids, one car, you make this much. here is a list of expenses you can choose to pay towards (make them essential bills and non essential ones so they have to think about where their money should go eg council tax, a holiday, rent, nappies, a phone)
investing, stock and shares, different kinds of saving accounts i’m 21 with a kid and a house and i’m used to all the everyday bills but those are the things i struggle to understand
mronion82@reddit
My mum taught maths and tried to get useful financial lessons in there- the majority of the school's catchment area was a poor estate and financial literacy wasn't something that was being passed down to the boys by their parents.
As others have said, compound interest is generally poorly understood. Payday loans were becoming popular at the end of mum's career and she made it very clear to her classes how what appears like a reasonable repayment rate is just a few mistakes away from 11,000% interest.
Goldenbeardyman@reddit
Investing in the stock market. King term investing, compounding returns all that stuff. If they start from when they get their first pay cheque they will be so thankful in their 30s when they want to buy a house.
James20985@reddit
Mortgages, credit cards, budgeting and saving
Silver_Adagio138@reddit
Emergency fund that’s liquid
Lazy-University-4839@reddit
The magic of compound interest!!
queergoblin95@reddit
What a payslip looks like once taxes, national insurances, student loans etc are deducted. I got a huge shock the first time I looked at my pay slip and saw how much was taken out.
Racing_Fox@reddit
Pensions.
Everyone teaches you about budgeting, nobody teaches you about pensions
LazyBarracuda@reddit
Like others have mentioned, I think the dangers of payday loans and calculating the obscene amount of interest you end up paying if you take one out.
Mediocre-Island5475@reddit
Teach them about buy now pay later scams, and how they make their money off of people who can't pay - plus how easy it is to rack up interest.
Also, sports betting is slowly becoming a problem - explain to the children that if they win more than they lose, their account will be banned, meaning it's literally impossible to make money. (This is true, look it up.)
These are major debt drivers for young adults.
cpbradshaw@reddit
Generally about standard bills and payments; basics like council tax etc.
Thelegendofcamelot@reddit
Martin Lewis ran a campaign years ago and has a free book you can download off the Money Saving Expert site.
dpark-95@reddit
The most important thing for kids is budgeting and that credit cards aren't free money.
It would also be good to show them how important it is to start a pension as soon as they start working, maybe by showing them the massive difference between compounding over 40 years Vs over 30 years etc
DPaignall@reddit
That you'll spend 40+ hours at work to earn money each week - look after the money!
Silver_Emu4704@reddit
One simple thing: the wealth mountain. You have to work to accumulate wealth until you reach a certain amount. This is commonly your pension + your ISAs + your home. Then once you hit that number you are financially independent. You can retire, you can continue to work, you can do whatever you like.
miggleb@reddit
Deffered gratification
WhoLets1968@reddit
Credit cards Mortgages Pensions Life assurance and how it differs to general insurance..and the latter is not like a saving account...so you aren't 'entitled' to make a claim..'cos you've paid in but never claimed before '
Thin_Sheepherder_584@reddit
Interest, inflation, budgeting, pensions, how to save.
Ok-Onion-5012@reddit
Salary plus real outgoings. Qualifying for a mortgage/house purchase. Credit cards/debit cards. Stocks and shares. ISAs. Saving in general.
gioology_@reddit
How debt can rack up. Credit card company techniques to give you said debt. Getting a mortgage. How interest rates work and what it will mean for me. How to budget.
thierry_ennui_@reddit
Financial literacy
oceanprocess88@reddit
Rule of 72
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