There’s something going badly wrong in this country…
Why is it that we can churn out world beating athletes if we put our mind (and money) to it, but we’re carrying a level of personal debt that many will never ever be able to repay and we have one million NEETs – let’s be blunt, kids from the same generation as our athletes whom we’ve consigned to the scrap heap?
As a parent the failure to focus on our kids, our country’s future, while continuing to put sticking plasters on today’s gaping wounds, makes me very angry indeed. So angry that I decided I had to do something about it, in my own little way. More of this later – because I need YOUR help – but first let’s look at this in a little more detail.
We persuaded our kids that they simply had to get a good education… That getting a good academic and then professional education (say learning to be a good accountant or lawyer) would somehow guarantee them financial success and happiness. So they went off to college, then uni. But somehow however for 1 million of them the equation ‘academic + professional brilliance = a great life’ hasn’t worked out so far. Many are stuck, saddled by debts, unable to build a life of their own.
So what’s gone wrong, and why? And are more than the 1 million NEETS affected?
I’d like to share my views with you. Please bear with me, because I obtained this insight by going into schools and colleges, not from a book, not even from my own family’s experiences.
You see, for a while now I’ve been talking to the students about the real world, on areas my generation haven’t exactly excelled, such as debt and money management. In some ways it’s been an extremely humbling and positive experience, in other ways it’s been utterly frustrating. And it’s certainly brought home a few home truths…
… Like the fact that we seem to have three generations in the UK at the moment with hugely different views of money – an elder generation of savers by habit who don’t know how to spend money; my generation of prolific spenders, who think today’s wish lists and their own financial security can be borrowed from others including future generations; and the youngsters who I call ‘conservative spenders’ – they’ll spend money that’s not theirs like it’s going out of fashion but only spend their own on things which they think will bring lasting benefits, such as education and houses. They’ve taken on board both their parents’ lack of control and their grandparents’ thrift. I also suspect that they’re worried more about tomorrow than we’d give them credit for…
… Where we, my and the older generations, have let them down is by failing to explain there’s a missing term in the equation. It’s a term we ourselves haven’t noticed. But it’s one the education system recognised was missing 10 years ago when the government principles ‘Every Child Matters’ came out following the Climbie case, talking about helping children achieve ‘financial wellbeing’ in later life. Shame no one has done anything like enough about it since… You see the missing term is ‘Financial Education’. And it’s so important that I think the real equation should read
‘academic + professional brilliance + 2 (financial education) = the ability for you to create your own great life’.
Because without the best financial education, no matter how hard the kids work, how well they do academically or professionally, all they’ll do is follow my generation, and end up in debt, with broken relationships, ill health, broken businesses, no pension, little control over their lives, caught in the ‘time for money trap’ where they are working ever harder for less money.
You see the education system hasn’t cottoned on to the fact that the world has changed, that there are additional things needed of it in today’s world. And that it’s incapable of delivering these new things on its own. Like … exactly how do you budget?; what’s good and bad debt?; what happens if you don’t provide for your retirement?; what’s the difference between saving and investing?; how do you build long term financial security for yourself now that there’s no such thing as job security?; what happens when you get into major debt?; what are the pros and cons of life’s big ticket purchases, including education?; what’s APR?; yes, even how do you balance your own chequebook?
Have any of your children ever come home from school or college saying they’ve covered any of these today? Wouldn’t it be far better to teach these key life skills while still at school/college than learn them through bitter experience in later life? And if you cannot make money work for you, or at least stop it working against you, what hope do you have of ever living a happy fulfilled life?
Right now there’s a huge need for people who know about money, yes you accountants, bankers and IFAs, to get involved in government initiatives such as STEM – which stand for ‘Science Technology Engineering and Maths’ – a bridge between the education and private sectors… To go into schools to talk to the children about the benefits of getting a good financial education… And to show them exactly how to do it… To share your experiences, so they don’t have to suffer the pain themselves.
I don’t know about you but I find it quite astounding our education system can treat as essential some of the subjects it does, yet finds it not nearly as important to teach real life skills critical to the financial, health, relationship and mental wellbeing of the nation. Quite clearly the education system is designed to churn out academic and professional gods and goddesses, yet in reaching for the stars it has taken its eyes off the ground, the real life skills needed in today’s tough world. Many schools remain transfixed by the league tables, while enlightened others have woken up to their students’ need for basic financial education – it’s these schools that contain staff driven to provide our youngsters with the rounded education needed today. But they need some help to do so.
You see it’s difficult to get across real world topics through a text book, these things are often better learnt from experience, bitter or not – even if schools weren’t under-resourced and bound by government’s myopic focus on tables they’d need our help to get the message across. And that’s what makes working with people outside of the formal education bubble critical. That’s why we need more ‘real people’ with financial skills involved. Sure the pay’s awful – in fact there’s none. Sure, we’re all short of time but ask yourself how many pointless internal meetings or rubbish networking events do you go to? – why not swop some of these and do some good instead? It’s really great when you’ve had a standing ovation from the kids. Or they’ve given you a ticker-tape exit – yes, it has happened to me. And after all your kids, our, future depend on it…
Even if you don’t feel you can stand in front of the kids or commit too much, you can still help… Challenge your kids’ school, your own old school : what priority, if anything do they give to getting a decent financial education? How do they deliver it? -by text book at the end of the final term or by bringing in real people to challenge and inspire the kids when it really matters? If you’re a school governor, what’s your school policy, in fact do you actually have a policy and properly considered strategy and plan for delivery? Ask the Education Minister his views, challenge him. Push the local authority. There’s much you can do.
Finally, as always I would really appreciate your feedback, good or bad, on my newsletter. And if any of you share my passion for your children’s future and would like to put something back but just don’t know how, just drop me an e-mail and I’ll gladly explain how you can get involved.
Midlands Business Recovery
‘The 21st Century Insolvency Practitioner’