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Reading finance in school: how can Europe do better?

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With the steep rise of digital technologies and accessible financial services, children have become more exposed to spending both online and offline. Later on in university, young adults are confronted with the reality that money is not only about paying for what we want but also about what we are obliged to pay. The question remains in our 21st century educational systems: why has there not been a more important drive to include financial literacy as part of skills taught in schools?

Europe and the world

The new section that appeared in the last PISA (Programme for International Student Assessment) report of 2015 was students’ financial literacy. The report includes numerous studies and data conducted on 15-year-olds worldwide to understand the strengths and weaknesses of our education systems. The regions performing above the OECD average in the EU are the Flemish community of Belgium and the Netherlands while the bottom of the list is composed of Poland, Slovakia, and Spain. In concrete terms, the latter countries have students who can make decisions about everyday spending but usually perform worse in financial literacy than expected based on the students’ reading and writing capabilities.


Despite seeing a difference between countries, the spread becomes more important when comparing several groups within the same country. In Italy, boys outperform girls in financial literacy while it is the opposite in Lithuania, Poland, Slovakia, and Spain. The socio-economic class and coming from immigrant families are also factors that affect the relationship that students have with money.

The most alarming aspect of these elements is the lack of financial literacy among those from lower socio-economic classes living on tighter budgets. Making more thoughtful decisions in their future investments and having less leeway to make mistakes have become important reasons to encourage households and schools to tackle the issue. Otherwise, the existing gap between the very rich and poor neighborhoods in towns, regions, and countries may even widen.

Measures making a difference in childhood

Research continues to show that children who manage money from an early age have a better chance to make more thoughtful financial decisions. Curiously enough, the regions where students have had, for example, a bank account are also, in general, doing better later on. In several countries, the banks have adapted specifically to this demand from parents to open up bank accounts for their children to manage their financial gifts.

Enabling teenagers to choose between spending or saving their financial gift becomes their unconscious first encounter with economics. “Not consuming today would potentially bring greater future satisfaction”, this phrase you would recall from your first economics class as the opportunity cost.

Aside from prioritizing money rather than their usual Christmas presents, earning money is another approach to raise awareness of sensible financial decisions among children and teenagers. In the majority of OECD countries, students are able to make some money doing chores at home or providing small services in the community. The exposure to the value of money and what it takes to get what they want could potentially lead these future adults to save from an early age and manage their expenses for and during higher education.

Learning in European schools

Financial literacy has been strongly correlated with reading and mathematics skills. Since one would imply the other, educational systems have started to incorporate an introduction to life skills and finance in traditional classes such as mathematics and social sciences. However, the benefits of this measure are still unknown and have not been tackled enough by the national educational systems in the majority of countries.

Since the school should be a place of equal opportunities, more measures are emerging independently around the world to encourage financial literacy of the youth. The European Banking Federation, grouping more than 3000 banks in Europe and led by important actors of the banking world such as Frédéric Oudéa and Giovanni Sabatini, has put forward financial education as one of its priorities. The “European Money Week” held each year in March has allowed several banks to organize seminars, conferences and classroom activities. This year it has even launched a European Money Quiz for 13- to 15-year-olds to compete on a European scale and promote finance to the European youth.

The present value of finance in schools

Persisting disparities between different regions in Europe highlight that some national systems have not been able to fully adapt themselves to a more connected environment. The lack of research done to understand the measures taken in neighboring countries has led generations to repeat the same vicious cycle. The ability to see money not only as coins and bills but also as savings and investments and the ability to manage it from an early age should be seen as a potential solution to some of the problems of our changing world where more individuals will have to rely on their own savings and investments rather than the government for their pensions. The post-WWII mentality of the welfare state in Europe is currently showing its limits and modernizing our educational systems could perhaps bring on a more stable environment across the Eurozone.

As the new PISA report will be published at the end of 2019, the skills in reading, writing and mathematics should not be the only components we look at. Elements such as financial literacy and student wellbeing will need to be closely reflected upon and used to create policies that will help reduce differences between European students in the future.

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