On the Money
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Children in Scotland do relatively well in financial capability compared to other parts of the UK, however there are still areas for improvement. While most children have money experience and savings knowledge, only half save regularly and few plan purchases. Provision of financial education is varied, with over 130 interventions led by schools, but coverage of topics is uneven and evidence of effectiveness limited. Improving family learning, expanding early education, and supporting vulnerable children present opportunities to further enhance financial capability in Scotland.
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On the Money
- 1. Single Financial Guidance Body Needs: How are children in Scotland doing at learning about money? 1
- 2. Single Financial Guidance Body There are some things children across the UK are doing well on ⢠Most have money and experience using it, incl. some experience of saving ⢠The vast majority believe itâs important to learn about managing money ⢠Most believe they can make a difference to their money situation ⢠Overall there is a cautious attitude to borrowing ⢠There is good theoretical knowledge of basic products and concepts Overall children in Scotland do better than their peers in other parts of the UK, including being more likely than UK average to: ⢠have bank accounts and look after their own bank details ⢠have seen their parents pay for things ⢠have experience paying for things themselves, including online ⢠do better on measures of financial knowledge, e.g. understanding terms and products ⢠be seen by their parents as being able to manage their money ⢠say they have learned to manage money in school
- 3. Single Financial Guidance Body There are still areas where overall, CYP are not doing so well: ⢠Only just over half of children save regularly ⢠Too few young people plan ahead for what theyâre going to buy ⢠There may be a lack of depth to some knowledge and how to apply it ⢠Too few young people have access to and use bank accounts There are also unique areas of need for Scotland: ⢠Children in Scotland are less likely to have responsibility over saving decisions at younger ages than their UK ⢠Only 23% of young people in Scotland have a goal to be financially independent from their parents within the next five years, compared to 31% UK average
- 4. Single Financial Guidance Body Some children and young people are at greater risk of having lower financial capability than others This includes children: ⢠With poor behaviour or low social-emotional skills ⢠Who have a teacher assessment of maths or English below expectation Within these skills, perseverance, irritability, and maths ability seem the strongest indicators of need ⢠With long-standing illness, disability or impairment ⢠Whose parents have no / low levels of qualifications ⢠Living in social housing, in low income, âstrugglingâ or âsqueezedâ, or over- indebted homes ⢠Who have a parent with sole caring responsibility 4
- 5. Single Financial Guidance Body Parents are a vital influence There are strong positive links between child financial capability and parents/carers: ⢠Giving children regular money â regardless of the amount ⢠Giving responsibility to their child for spending and saving decisions ⢠Setting rules about money ⢠Role modelling behaviours ⢠Attitudes to teaching children about money ⢠Parentsâ own financial capability Presentation Title 5
- 6. Single Financial Guidance Body Provision: what financial education is happening in Scotland? Presentation Title 6
- 7. Single Financial Guidance Body Whatâs happening to help 130+ financial education interventions in UK, delivered by 100+ organisations 36 UK-wide of these are UK-wide, 25 Scotland-only, 6 Scotland + 1 or 2 other nations Geographical gaps â especially outside central belt Relatively low levels of funding in Scotland Vast majority involve face-to-face delivery Most is universal and not targeted at specific needs or more vulnerable groups Very few focus on âintermediariesâ or parents (none focus only on foster carers) May be a slightly higher use of delivery through teachers, practitioners, and young people as peer educators compared to rest of UK (where volunteers, paid facilitators and funding organisation staff more widely used) Provision is skewed towards older age groups â in Scotland the age group targeted by the largest number and reach of interventions is 14-16, followed by 16-18 7
- 8. Single Financial Guidance Body Schools are the most commonly reported delivery setting â almost 2/3 of interventions in Scotland delivered in schools. Other research has shown less than half of children aged 7-17 in Scotland say theyâve learned about money management at school or college Community groups and childrenâs centres seem to be more commonly used as delivery settings in Scotland than other nations of the UK; youth groups and FE colleges less often Most frequent topics covered: ⢠budgeting, keeping track, and planning ahead ⢠making spending and saving choices ⢠needs vs wants ⢠understanding ways to save Least covered topics include choosing and using mortgages, pensions, investments, and insurance; fraud and exploitation, and gambling and taking risks, also covered relatively infrequently Presentation Title 8
- 9. Single Financial Guidance Body Evidence: âwhat worksâ best to meet need, based on evaluation and research Presentation Title 9
- 10. Single Financial Guidance Body Train the trainer can deliver impact for trainer and CYP Face-to-face classroom delivery and workshops can build ability and mindset Face-to-face approaches combined with experiential learning may impact behaviour Parental involvement can influence behaviour Starting early matters Timing and context matter â âjust in timeâ and âteachable momentsâ Behaviour change requires more than just knowledge or skills There remain large gaps in evidence, e.g. long-term adult outcomes, return-on- investment, comparison of different approaches on same outcome 10
- 11. Single Financial Guidance Body Policy: areas we believe there are big opportunities in Scotland 11
- 12. Single Financial Guidance Body Family learning: Learning Together published August 2018 Schools: personal and social education review, 15-24 learner journey review, expansion of early education and childcare Vulnerable children and young people: Child Poverty Act and local plans, SEN reforms, support for young carers Presentation Title 12
Editor's Notes
- Bank accounts - (72% compared to 63% UK) Pay for things online (52% Scotland, 41% UK). parents of 7- to 17-year-olds saying child could manage money (90% vs. 84%) Learned to manage money in school (46% compared to 40% UK).
- IN SCOTLAND: 12% of children aged 8â17 in Scotland save money every time they get some, and 33% save most times. Only 36% of 14- to 17-year-olds often or always plan how they are going to buy the things they need. Only 54% of 12- to 17-year-olds in Scotland correctly answered a numerical question concerning interest and inflation. Around one in five (19%) of 12- to 17-year-olds in Scotland were unable to correctly identify from looking at a bank statement how much was in the account. Reading a payslip presented difficulties for 14- to 17-year-olds, although not as much as across the UK in general: 39% could not identify pension contributions and 55% could not identify how much had been paid. 21% of 14- to 17-year-olds said they donât keep track of their money, an important part of budgeting and saving. A further 29% only keep track in their head. By age 16, a third of young people are getting money from work outside the home. Yet three in ten 16- to 17-year-olds (31%) donât have a current account, and 5% have no bank account at all (neither savings nor current account). Of those that do have an account, 26% have never deposited money, and 29% do not look after their own banking details. only 32% of 7- to 11-year-olds in Scotland have sole responsibility for deciding whether they should save their money vs. 42% across the UK â - Only around half of parents in Scotland are able to model âgoodâ saving behaviour, with 52% saying they saved every or most months; 23% of parents are over-indebted. - One in five parents of 12- to 17-year-olds have never or rarely talked to them about the risks of borrowing and the impacts of debt. - Despite the evidence for the value of starting early when talking to children about money, only a minority of parents believe that children aged under 8 should be given a range of financial education experiences. For example, only - 28% think 5- to 7-year-olds should be taught the importance of savings, and 9% for the under-5s. - A quarter of parents do not think children should be allowed to make mistakes with money until they are aged 16 and above. - Only 46% of 7- to 17-year-olds say they remember learning about managing money at school or college. UK stats: Only 39% of 14- to 17-year-olds often or always plan how they are going to buy the things they need. There is a knowledge gap around relatively simple concepts such as interest and inflation, with only 63% of 12- to 17-year-olds knowing that âinflationâ was the term for prices going up in the shops. One in five (21%) of 12- to 17-year-olds were unable to correctly identify from looking at a bank statement how much was in the account. 62% 14-17 year olds could not identify how much had been paid from a payslip. Four in ten 16- to 17-year-olds (39%) donât have a current account, six in ten (60%) donât have a savings account, and nearly one in five (18%) have no bank account at all (neither savings nor current account). Of those that do have an account, 32% have never deposited money, 40% have never been into a bank, and 40% donât look after their own banking details. In Wales, encouraging more conversations about finances during childhood may be beneficial (in ways that recognise the higher proportion of parents who consider their bills a burden), as well as again considering the reasons why fewer young people than the UK average aim to be financially independent. Â Northern Ireland has a number of areas where additional focus may be valuable, including children saving and keeping track, being given financial responsibility, seeing a range of financial transactions taking place, and parents talking about money with their child(ren) on a regular basis. Â
- The aspects of financial capability children do better or worse on varies, e.g. Poor behaviour linked to lower scores on mindset, ability Social-emotional skills linked to mindset Cognitive skills linked to ability, some mindset and connection Longstanding illness /disability linked to varied specific measures Economic indicators related to ability, connection, some mindset These nuances matter for tailoring support - and because some aspects drive financial behaviour more directly than others. But importantly of course, a majority of this needs analysis looks beyond the overall population of children and young people, And considers which children may be in greater need than others. Important to note upfront that we were interested both in those children who seem to be at increased risk of poor financial capability, and those who are at risk of disproportionately negative impacts of poor money decisions. This is consistent with the way we have defined âvulnerabilityâ throughout our research. The findings of the needs analysis therefore cover both the groups that we think there is sufficient evidence of increased need to justify specific targeted support But also those groups who may not have significantly increased risk of poor financial capability, but still have unique needs and nuances to the context in which they live which may benefit from the tailoring of support that is offered. I also wanted to note upfront that where our survey analysis didnât find a strong difference between the financial capability of certain groups, It doesnât mean that we believe they donât have additional needs â Just that it is likely those needs are explained by factors stronger than that characteristic. For example, our survey analysis did not show definitive differences in financial capability overall for young carers, compared to their peers. And when we looked at LAC â the differences we found were far fewer than for other skills and characteristics like behaviour, or cognitive skills. However, wider qualitative research has suggested these groups often face additional and sometimes substantial financial challenges that may make them disproportionately vulnerable to poor outcomes. More likely to be living in low-income households, to average to achieve poor educational attainment and employment outcomes, and to find transition to adulthood, such as getting a job or moving out of the home, more difficult. So, what did we find? Children with low levels of cognitive and/or social-emotional skills, and poor behaviour, are likely to be at risk of poor financial capability and in many cases poor financial outcomes, and support targeted at these groups should be considered. The strongest indicators of need in these areas seem to be a childâs perseverance, irritability, and maths ability. In many cases these skills appear stronger indicators of need than certain characteristics or life contexts, such as having caring responsibilities, which is positive as skills can be developed. There are also some characteristics and life contexts that are linked strongly enough to poorer financial capability to justify targeted support, notably: having a longstanding illness or disability; having parents with no or low levels of qualifications; growing up in a low-income, over-indebted, and/or MAS âstrugglingâ or âsqueezedâ home; having a lone parent; or having parents with low financial capability themselves. In almost all potential categories of need we considered, there are at least some findings of relevance to those delivering interventions, to consider when working with children who have those characteristics, skills or contexts affecting them, for the potential of tailoring content and methods to address unique financial capability needs and strengths. These are covered in summary on the table in the needs analysis Exec Summary. One final point before I move on. If we think about the scale of need, even just for these groups outlined here where we have definitive links proven to lower levels of financial capability â More than 1 in 10 longstanding illnesss/disability About 1 in 20 have a behavioural problem Attainment and cognitive skills are measured in a host of ways but, for example, around 3 in 10 children in England do not achieve expected levels at maths GCSE, and similar number for English 1.8m lone parent households with dependent children Somewhere between a fifth and a third of children living in low income homes across different parts of the country As some examples We can see the potential scale at which more targeted support might be beneficial. Worth bearing in mind in context of provision later
- Social and community context is likely to have some influence, but research on this is limited Children who recall receiving financial education in school tend to be more financially capable This small positive link is also present for those children and young people at greatest risk of doing less well on financial capability - but the size of difference is the same as for other children This suggests financial education as currently delivered in schools may be insufficient on its own to âclose the gapâ
- 25 interventions cover Scotland only. 19 of these use direct delivery and 12 include the use of learning resources. Two interventions include training/ qualifications for practitioners who work with young people, five interventions include training/ qualifications for young people, and three include financial products. When looking at all interventions delivered in Scotland, more than three-quarters involve direct delivery, half use learning resources, a fifth involve training/ qualifications for young people, just over 1 in 10 involve training/qualification for practitioners, and fewer than 1 in 10 involve financial products. Charity sector largest deliverer â about half; financial services deliver about another fifth Total UK funding >ÂŁ13m Total funding going into interventions available in Scotland ÂŁ779k Funding going into Scotland-only interventions ÂŁ559k In Wales and Scotland, the number of interventions targeting the 14-16 age group just exceeds the number focusing on 16-18. Looking at the variation between nations of the UK, the use of paid facilitators and volunteers seems to be highest in England and Wales, while Scotland seems to have a higher proportion of interventions delivered through teachers, practitioners (other than teachers) who already work with CYP, and practitioners specialising in financial education. Scotland also seems to have a greater number of interventions involving children and young people as peer educators. Staff from funding organisations are relatively more frequently used in England. Scale ranged from 20 to 1m 36 interventions delivering across the whole UK, 39 in England-only, 14 Wales-only, 25 Scotland-only, 3 Northern Ireland-only, 5 delivering in England & Wales, 1 in England, Wales, and Northern Ireland; 2 in England, Wales, and Scotland; and 4 in England and Scotland. The majority of this reach is by education that has a face-to-face element; around 1.43m of the reported reach is through online or learning resource-only interventions. Direct delivery with children and young people (e.g. through workshops or lessons) was by far the most frequently reported type of financial education. Only a very small number of interventions focus on intermediaries working with children and young people, or parents/carers 56 interventions 11-14 54 for age 9-11 46 for age 7-9 Most provision is universal - fewer than 2 in 5 focus on specific needs⌠âŚand the reach of these is just 4% of the total reported reach Focus on transition and other policy priorities: Independent living Excluded/at risk of exclusion Homeless/at risk of homelessness About to start university NEETs Least targeted groups include Gypsy/Roma/Traveller, military families, physical impairments, SEND, young carers, asylum seekers/refugees, BAME In Scotland there were no interventions mapped that targeted young people with SEND, physical impairments, mental health difficulties, or at risk of /experiencing abuse (including domestic abuse) Very few focus only on one group or area of need Vast majority focus on 16-18; over half focus only on 14+
- Ability âunderstanding way to save top for all. Financial problem solving, financial numeracy skills, understanding financial documents, and what borrowing means, were found in a higher proportion of interventions delivered in Wales, Scotland, and NI, than in interventions in England or the UK. Among the mindset content, âmaking spending and saving choicesâ was the overall most frequently mentioned topic. It came out top in Scotland too Behaviour â top same â budgeting - in Scotland, âshopping aroundâ, and âmaking choices about borrowingâ are the second and third most frequently covered topics, followed by âtalking about moneyâ and âliving independentlyâ, although these feature in less than 6 in 10 interventions. Most commonly covered connection topic in Scotland is âwhen and how to seek guidanceâ â in other nations it tends to be more practical In Scotland, where fewer than 1 in 20 interventions include content on choosing and using mortgages (this figure is between 1 in 10 and 1 in 4 for England, Wales, and the UK, and 2 of 4 interventions in Northern Ireland include it). More widely, the total reported funding for financial education for interventions mapped is over ÂŁ13m, based on funding information for only just over half of interventions mapped. From this data, financial services are the biggest funder, contributing to over ÂŁ6m of funding and sole funders of almost ÂŁ3.7m, with government agencies also playing a large part, contributing to almost ÂŁ4m and sole funders of almost ÂŁ1.5m of financial education in the UK. Other major funding sources included MAS, and investment from businesses delivering financial education as part of for-profit enterprises
- Reviewing evidence across UK and internationally to understand what is likely to be effective in supporting children and young people to develop good financial capability Considers a range of evidence from academic journals, providers, policy papers, thought/insight, data analysis, Evidence Hub / What Works and Provision Analysis Not an evidence-rich landscape â most evidence generally lacking rigour (study design, sample size, causality); competing interests Methodological differences mean making comparisons between, or combining findings from, studies is very difficult
- Reviewing evidence across UK and internationally to understand what is likely to be effective in supporting children and young people to develop good financial capability Considers a range of evidence from academic journals, providers, policy papers, thought/insight, data analysis, Evidence Hub / What Works and Provision Analysis Not an evidence-rich landscape â most evidence generally lacking rigour (study design, sample size, causality); competing interests Methodological differences mean making comparisons between, or combining findings from, studies is very difficult
- Learning Together â Measures to promote parental engagement and families learning together Emphasis on addressing barriers to parental engagement and enhancing practitioner skills 52 national actions including: Improved guidance, training, awareness raising and advice on parental engagement and family learning by 2019-20 Examples of good practice on learning at home by March 2021 Reviewing and refreshing Parentzone Scotland Assessing impact of family learning programmes Increase support for evidence-based family learning programmes in the early years Personal and social education review As part of its mental health strategy, Scottish Government undertaking review of personal and social education. August 2018: published Education Scotlandâs thematic inspection of PSE (second phase of the review). There is evidence that young people want a greater focus on skills for life, such as money skills, in the curriculum. [Generally it found that work needed to improve CYP experienced of personal and social education overall, and to ensure teachersâ skills and knowledge across PSE are up-to-date] Next phase is engagement with key stakeholders, before publication of recommendations end 2018. So more of an immediate opportunity to strengthen financial education in this part of the curriculum. 3. Review into the learner journey for young people aged 15-24 May 2018: Scottish Govt published report of its review of the learner journey for 15-24 year-olds Included a number of recommendations/actions which could be harnessed to strengthen Fin Ed for this age group. E.g.: A more joined-up approach to careers, information, advice and guidance for this age group, starting 2018. Any look to improve this offer could be an opportunity to strengthen advice and guidance around Fin Ed, linked up with choices around further study and careers Considering how better to address the wider support needs of this age group as part of the personal and social education review Scottish Govt leading development of a shared vision for the post15 education system 4. Expansion of early education offer â With the expansion of the offer to 30 hours of free childcare, the Scottish Government has committed to ensuring this provision is of high quality. New national standards for early learning and childcare AND inspection framework â to take effect in 2019-20 An opportunity to strengthen practice around financial capability development in early years settings â including activity that promotes outcomes in early years linked to good Fin Cap, such as numeracy and behaviour. Note: Learning Together makes clear that parental engagement will be reflected in the new national standards Evidence from Talk Learn Do indicates that we can have a real impact supporting parents to develop their childrenâs own money skills AND we know from the evidence review around effective financial education that the engagement of parents is key.  âLearning togetherâ published last month is the Scottish governmentâs new family learning and parental engagement strategy. Could be a real opportunity to strengthen practice around family engagement in childrenâs learning about money and families learning together.  Sets out 13 goals on parental involvement, parental engagement, family learning and learning at home, to be delivered from 2018 â 2021, including: help parents engage more in their childrenâs learning at school and in early learning settings increase access to evidence based family learning opportunities and programmes, AND address barriers that limit parentsâ involvement and engagement Other stuff â ignore! Great emphasis on collaboration with parents in guidance on schoolsâ use of Pupil Equity Funding (funding that goes direct to schools to close the poverty-related attainment gap) Development of further proposals for better use of digital technology to help engage parents (in consultation with parents) â due June 2019 (Scottish Govt and Education Scotland) . Professional learning resources and case studies to support work to improve parental engagement and family learning - by March 2019, Education Scotland Bring forward In addition, the Scottish Government will make a total of ÂŁ350,000 available between 2019 and 2021 in order to develop small scale research and best practice materials on a range of equalities themes. Pre-birth to 18 Published jointly with COSLA, and commitment to collaboration across local authorities and national agencies. National guidance on Pupil Equity Funding will highlight the importance of collaborating with parents in planning and decision-making processes relating to the funding. National vision for parent and carer engagement in learning and family learning , allowing for local and community flexibility Recognising that parents and carers are the primary educators of their children. (note a theme across other nations too â Wales Community Learning Centres and England opportunity areas) Link back to Talk Learn Do and our knowledge that involving parents in cyp learning makes it more effective. And opportunity to build on Talk Learn Do to understand how parents and their children could be supported to learn together. Child Poverty (Scotland) Act 2017: child poverty reduction targets national child poverty delivery plans and annual progress reports duties on local authorities and Health Boards to report on activity to tackle child poverty establishes a Poverty and Inequality Commission No specific action on financial capability in 2018-22 delivery plan However, possible opportunities⌠supporting LAs and HBs to incorporate financial education into their child poverty plans using Talk Learn Do to enhance new community education programme with Gyspy, Roma and Traveller families Many children with SEN likely to require specific targeted financial education Reforms to support for children with SEN through Education Scotland Act 2016, in force from January 2018 â an opportunity? Revised statutory guidance makes explicit reference to financial capability Scottish Government developing new resource for disabled children and young people and their families Many young carers would benefit from targeted and specific support Under Carers (Scotland) Act 2016 â new duties for local authorities to: provide young carers with a young carer statement (needs and outcomes) provide information and advice to carers, and prepare a local carer strategy (in partnership with the relevant health board). Opportunity to engage local authorities in work to help young carers develop their financial capability We know from our research that some children are at greater risk of having poor mental health (child in poverty, children with a long-term illness) and others may need targeted specific support (such as looked after children and young carers) Our review highlighted a number of current policy developments which could provide a âhookâ for action to advance financial education for some of these children⌠Child poverty: In the UK context, focus on child poverty weakened, with coalition govt removing UK-wide targets to eradicate child poverty and the requirement to have a UK wide child poverty strategy. However, far stronger emphasis on child poverty by the Scottish govt. The Child Poverty (Scotland) Act 2017 introduces: Introduces child poverty reduction targets requires government to publish child poverty delivery plans and annual progress reports Places duties on local authorities and Health Boards to report on its activity to tackle child poverty; and establishes a Poverty and Inequality Commission First delivery plan â 2018-22 â published in March 2018 and includes a range of actions to tackle child poverty and its effects. Current actions do not highlight financial education, but this could be an opportunity â in light of the relationship between child poverty and having poorer financial capability. For example, local authoritiesâ and health board could be supported to build financial capability activity into their child poverty plans, or elements of Talk Learn Do could be incorporated into the new community education programme with Gypsy Roma and Traveller families. 2. Children with Additional Learning Needs All of the four UK nations recently introduced reforms to their statutory frameworks for children and young people with additional learning needs â in the case of Scotland through measures in the Education Scotland Act 2016 which came into force in January 2018 So there could be an opportunity to embed financial capability more effectively in provision for CYP with SEN, as local agencies and practitioners focus on improving provision. Though worth noting that the distraction of implementing reforms could also make it harder to get a focus on this. Useful that the revised statutory guidance (Dec 2017) on provision of support to children with SEN makes explicit reference to financial capability, highlighting money management as an important element of transition planning for older young people with additional support needs who are due to leave school. In addition: government ended consulation on the development of an online and app-based resource for disabled children and young people and their families with information relating to rights and entitlements, accessibility of support (including financial support) and transitions (including the development of skills for independence). The resource is due to be launched in winter 2018. Again â this could be an opportunity to communicate directly with disabled CYP and parents and carers with advice and tools on developing financial capability. 3. Young carers No evidence that at risk of poorer financial capability BUT clear that would benefit from targeted and specific support, in light of potential financial responsibilities earlier in life. The Carers (Scotland) Act 2016 came into force in 2018: New duties on local authorities to: provide young carers with a young carer statement setting out the carersâ needs and planned outcomes; provide information and advice to carers; and prepare a local carer strategy (in partnership with the relevant health board). Set out these provisions and carersâ entitlements under the Act in a Carersâ charter Clear opportunity to engage local authorities in thinking about how to effectively support young carers and develop their financial capability. Perhaps to test effective approaches to embedding financial education into local authoritiesâ provision.