8 in 10 of young adults ‘didn’t learn about finance at school’

Many young adults are leaving school with major gaps in their financial knowledge, a new study has found.

Boon Brokers carried out a survey of 18 to 24-year-olds and found that 83% don’t consider school their main source of education on financial matters such as mortgages.

Instead, 39% said they learned most of their financial knowledge from their parents, and a further 14% said they learned from social media.

That’s despite financial education being on the curriculum at many schools for more than a decade.

Most young adults don’t know financial education is taught at schools

Since 2014, financial education has been on the national curriculum for local authority-run secondary schools, with the subject covered in citizenship lessons.

But academies and free schools can opt out of teaching it, and financial education isn’t on the curriculum in primary schools at all.

As a result, many young people are growing into adults lacking key financial knowledge.

This may partly explain why nearly three-quarters (74%) of young adults don’t know that financial literacy is part of the national curriculum.

“If young people don’t know that financial education is being taught, then how can we expect them to notably learn from it?” said Boon Mortgages.

“It goes without saying that a curriculum means nothing if the subjects aren’t actually being taught.”

Young adults ‘have misplaced confidence in their financial knowledge’

Despite many young adults not being formally educated on financial matters, most are still confident they understand the key issues.

In fact, 67% said they think they have an above-average understanding of mortgages.

“This misplaced confidence can lead to a vicious cycle of debt, negative equity and potentially repossession,” Boon Brokers warned.

“Simply, young adults will not be able to prepare for the financial commitment of a mortgage if they’re not taught how debt, interest and long-term repayments work.”

Boon Brokers added that relying on parents and social media to learn about mortgages can also cause problems.

This, it said, is because parents may inadvertently be “recycling outdated misinformation”, while social media is full of “potentially unqualified influencers”.

Mortgage knowledge ‘shouldn’t be treated as optional’

“The current financial education in the UK is not equipping the young people of today with the financial skills that they will need to navigate real-world financial responsibilities,” Boon Brokers warned.

“It’s time to stop treating mortgage knowledge as optional, when it is so very clearly essential for everyone who wants to own their own home.”

Boon Brokers added that without a “new focus on practical and relevant financial education”, a generation of young adults risk “unknowingly walking into poor mortgage decisions and long-term debt”.