Election underscores need for financial literacy

The Federal election is reaffirming the need for financial literacy to be taught in schools, according to Connect Financial Service Brokers, as better financial literacy would lead to better informed voters.

Connect Financial Service Brokers chief executive, Paul Tynan, said compulsory financial literacy in school would go a long way to helping future generations make more informed decisions about their long-term personal and professional interests.

“With most commitments being made by politicians during elections, it has become an imperative to understand how they will impact the broader economy as well as individuals, their families – and business owners and their employees,” he said.

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“Financial literacy is a core life skill to successfully participate in an increasingly complex modern society.  So why should young Australians be forced to play catch up with respect to the increasingly complex world of finance and money after leaving school?”

Looking to models overseas, he said the US was seeing a growing trend of more states making the teaching of financial literacy mandatory, with 54 personal financial education bills pending in 26 states.

“Now, 11 states, including Florida, require students to take a stand-alone personal finance course to graduate and more than 20 other states include some sort of personal finance education in their curriculum in different ways.

“Regrettably, although the benefits of financial education can make an immense difference by empowering and equipping Australians – especially young people – government and the education system are dragging their collective feet.”

Tynan said financial literacy should run throughout the secondary school curriculum and be integrated into a framework that allowed students to gradually build and expand their knowledge. 

“Just as learning a new language or skill takes time, building financial skills requires time and years to gradually build knowledge, familiarity, and confidence to manage one’s own finances when leaving school and entering adulthood.”

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