A recent survey by Household, Income and Labour Dynamics in Australia (HILDA) has uncovered a rather concerning statistic – Australians aged 15 to 24 are the most financially illiterate group in the country.
It’s a worrying finding when a fair proportion of our population is lacking the basic skills to make sound fiscal decisions in an era where finance is becoming more complex. Knowing how to budget and save, avoid debt, choose worthwhile financial products and understand economic terms such as taxes, bills, investment, diversification and inflation are core components of adult life. However, young Australians just aren’t being exposed to these concepts during their schooling lives.
The Royal Commission into Australia’s banking sector has highlighted a need to reinvigorate economics curriculum across the country. With the Commission discovering that many consumers don’t take interest in or have the confidence to approach money matters, experts have called for an increased focus on financial literacy education.
The Organisation for Economic Co-operation and Development (OECD) recommended that economics should be taught as early as possible back in 2005; however, financial education in Australia has taken a step in the opposite direction. Only 40 per cent of Australian secondary schools offer economics as a subject, a figure that hovered around the 90 per cent mark in the early 1990s. What was once the third most popular HSC subject is now struggling to break into the top 20, with most of the schools offering economics belonging to the private sector.
While the need for financial literacy education is clear, what is stopping us from teaching it? Experts have highlighted a lack of resources as a hurdle, while an already cramped curriculum has made educators reluctant to introduce more learning material. A shortage of adequately trained teachers also presents a major issue.
Several strategies have been tabled to enhance economics education in Australia. One approach proposes the establishment of dedicated training programs for teachers, equipping them with the resources, confidence and expertise to teach financial literacy. Developing a national teaching and learning framework, providing access to resources, finding sustainable sources of funding and adapting education strategies to account for age and social, racial and geographical factors have also been suggested as viable tactics.
A number of programs have been launched in Australian schools to kickstart financial literacy education. MoneySmart, a financial guidance website run by The Australian Securities and Investments Commission (ASIC), offers teaching resources that help to introduce students to economics at the beginning of their schooling lives. The curriculum is tailored to age, so while Year 4 pupils learn about money-grabbing advertising tactics, senior high school students are shown how to lodge tax returns and identify financial scams. Reserve Bank Australia has also set its sights on promoting economics education, with staff visiting schools around the country to talk to students and teachers about financial literacy.
Few people would disagree that financial literacy is empowering, and that’s why the teaching of economics is becoming as important as ever to young Australians. Do you agree that financial education should begin at the grassroots level of Australia’s curriculum?