Several states have banned financial institutions from delivering banking and branded education programs in schools, paving the way for school-led programs free from commercial interests. There is a growing number of new resources and solution providers pitching to the school market. In today’s reader submission, Carly Sawatzki and Jill Brown, from Deakin University, and Peter Saffin, from the Mathematical Association of Victoria, outline some guiding criteria to help schools consider ways to strengthen their financial education programs.
What is financial capability?
Students are financially active from a young age – from observing financial transactions when shopping, to making their own decisions with cash and gift cards they have received for special celebrations. Later, they might work in a family business or secure their first job, giving them a taste of financial independence.
It is important that schools, families and communities provide meaningful learning experiences that support young people to develop financial capability. Students need strong bearings to navigate what is an increasingly complex financial world and there are many connections that schools and teachers can make with students’ existing understandings about money. Lessons that help students make sense of their world and develop new knowledge, skills and capabilities also build their confidence to manage their money in ways that protect their future.
What might a holistic financial education at school look like?
Typically, financial education at school focuses on personal administration of money matters. Students might prepare to apply for a job, get a tax file number, and develop strategies for managing an income (including making savings). They might learn about interest, fees and charges associated with different forms of credit – i.e., buy now pay later services, credit cards, payday or fast cash loans, HECS-HELP loans (to help pay for tertiary studies) and more traditional loans.
Technological innovation or ‘fintech’ is changing the way we transact and manage our money. It is therefore important that students here in Australia learn to transact safely and securely online and via apps, from mobile banking to the MyGov and Medicare services.
Students might also learn about the risks and rewards associated with more complex financial products and services, including different insurance and investment options (i.e., public vs private healthcare, superannuation and cryptocurrency). In all of the above contexts financial decision making is used, and this involves risks that we want to help students learn to identify and manage.
Of course, our financial reality and the financial choices that are available to us are influenced by the health of the society and economy in which we live, including the cultural and social factors that shape our first experience of money. For this reason, it is important to explore issues of financial education early in school, and continue to engage in financial education throughout school and beyond. Financial impacts are significant for individuals, and also for local, national and global economies (emissions targets and renewable energy projects are a good example).
There are simple ways to expand the traditional individual focus of financial literacy to develop an awareness of the impact of personal financial decisions on society and the planet. For example, learning about taxation as a social contract between individuals and governments can foster the sharing of resources. Likewise, lessons that explore ways to spend and invest sustainably, and giving to worthy causes, convey the view that how we use our money can make a difference to others. Related to this, students might explore how social enterprise can contribute innovative solutions to a fairer, more sustainable world. Projects that promote a circular economy through recycling and upcycling resources orient students to reduce their environmental footprint.
While challenging and sensitive, students also need to explore the ‘dark side’ of finance if they are to develop scepticism and resilience, but also an ethics of care in how they use money. Young people face new risks in the form of scams and unethical business practices. Studying cases of financial deception, corruption and fraud in Years 9 and 10 can help students to identify abuses of privilege and power.
A desire to ‘fit in’ and spending being invisible can lead to costly mistakes. Young people benefit from opportunities to develop awareness of their financial motivations and behaviour and conversations focused on self-regulation strategies. Being a ‘shopaholic’ and feeling addicted to video games (with in-game purchases) and sports betting are topical examples for exploring financial motivation and self-regulation in Years 9 and 10.
Can a commercial resource or solution benefit your students?
There are a growing number of free and commercial (fee for service) resources and solutions available to schools seeking help to develop their financial education program. These solutions may include downloadables, incursions for students, workshops for teachers, online platforms and games. Often these solutions are charged on a per student basis, with pricing ranging from $20 to $80 per student per year. The onus is on schools and teachers to judge the quality of the offering and the value-add to students’ education.
If your school is considering one of these solutions, there are some important initial questions to consider. These include:
- Who designed the program?
Do they have a background in Australian school education? Have they collaborated with education experts to ensure their solution is informed by educational research? Is the program linked to the curriculum? Has the approach been independently evaluated?
- Is the program inclusive and respectful?
Does it consider all students’ financial realities and perspectives, including their socioeconomic and cultural background? Are all students included and able to achieve success? Or might some students feel judged and marginalised? For example, a mock economy with a reward system might produce unintended consequences for the classroom, like a bargaining attitude or unhealthy competitive behaviour.
- Is the program current and contextualised?
Will it explore real financial contexts that are appropriate to your students’ current and future needs? Are these contexts rich and engaging, and linked to student interests, and developmental needs in relation to the financial demands of their current and future financial life?
- Will the program strengthen your existing approach?
Can the program be adapted and integrated across your school’s existing programs?
- Are there opportunities for you to develop your teaching practice too?
Will the approach to teaching and learning help you and your colleagues to learn about your students, as well as economics, finance and mathematics concepts?
What else should I consider?
There are many curriculum-related considerations, but here are some guiding criteria to keep in mind.
Aligns with learning area content, particularly Economics and Mathematics
In Economics & Business, students develop the knowledge and skills that equip them to participate in and contribute to the wellbeing and sustainability of the society, economy and environment. Studying Economics & Business helps students to appreciate the interdependence of decisions made within economic systems, including the effects of these decisions on individuals, businesses, governments and other economies, and on environmental and social systems.
In Mathematics, students benefit from lessons that connect the real and mathematical worlds and help them to develop mathematical proficiencies (understanding, fluency, problem-solving, reasoning). Much of the mathematical knowledge and skills taught at school can be applied to economic and financial contexts. For example:
- Mathematics prepares students to make sense of personal financial statements where information and calculations are presented in tables, graphs and charts.
- Proportional and algebraic reasoning underpin loan and investment scenarios.
- The study of data and statistics prepares students to think critically about social and environmental issues that affect economic prosperity.
Develops financial numeracy
Students who are numerate are better equipped to make informed financial decisions. Students become numerate as they develop the knowledge and skills to use mathematics confidently across learning areas at school and in their lives more broadly. At school, they might learn to make sense of bank statements, bills and payslips.
Helps students develop financial language and literacy
Students benefit from exploring real-world problems where financial language is used. For example, when planning an enterprise, students learn terms like revenue, expenses and profit, or supply and demand. When exploring important public services like healthcare and transport, they learn about concession pricing. And when investigating credit, they learn to distinguish between simple and compound interest and fees. Note that these examples also involve calculations, highlighting the connectedness of financial literacy and numeracy.
Prepares students to make critically-informed decisions
Quality financial education instils a healthy skepticism that can protect against risk. People who are financially capable can locate and make sense of complex information. They can think critically, pose good questions and discern quality, trustworthy answers when thinking about government policies and interacting with big organisations. These skills help them to make informed decisions. A good example is finding out about a new financial product or service and considering whether it is the right fit for your personal circumstances. Questions might include:
- ‘Will I be locked into a contract?’
- ‘What are the terms and conditions?’
- ‘Are there any hidden fees and charges?’
- ‘Could I lose my money?’
- ‘How could I better use or protect my money?’
Selecting quality financial education resources and solutions that will meet your students’ needs is not an easy thing to do. We encourage you to look for a level of sophistication that can support true learning and development towards active and informed financial decision making.
- Deakin University’s Economics + Maths = Financial Capability research project includes a professional learning series for teachers.
- The eSafety Commissioner provides a range of education resources to promote safe and enjoyable online experiences.
- If you have concerns about a student being negatively impacted by financial hardship, financial abuse, or online gaming or gambling, seek advice from the school psychologist or school counsellor. Students can also contact Kids Helpline or Headspace.
Kids Helpline 1800 55 1800 https://kidshelpline.com.au/
5 to 25 year olds, any time, any reason.
Confidential phone counselling available all day, every day.
Online chat available 24/7, 365 days a year.
Headspace 1800 650 890 https://headspace.org.au/
12 to 25 year olds, any time, any reason.
Phone counselling available all day, every day.
Online chat available 9am to 1am EST daily.
Acknowledgement: The authors have received funding from the Ecstra Foundation for the Economics + Maths = Financial Capability research project. Deakin University is working in partnership with The Australian Association of Mathematics Teachers (AAMT), Business Educators Australasia (BEA), The Victorian Commercial Teachers Association (VCTA) and The Mathematical Association of Victoria (MAV).