Basic maths skills oil the wheels of financial literacy

Basic maths skills oil the wheels of financial literacy

This article is the latest part of the FT’s Financial Literacy and Inclusion Campaign

When my father taught adult numeracy in Birmingham in the 1980s he would ask each new class what they hoped to learn. On one occasion, a woman who worked as a lunchtime supervisor said she wanted to know about percentages. Her colleagues were telling her that the pay rise they had been offered was not enough, but she had no way of judging because she didn’t understand the concept of a percentage increase.

Understanding percentage change is one of those mathematical fundamentals that often surfaces in financial literacy discussions. The Money Advice Service’s original 2015 report used it as a key measure, asking people in their survey to say how much £100 paid into a savings account would be worth after a year if it accrued interest at 2 per cent. More than a third couldn’t answer correctly. 

So arguments, such as that made in FT Money by Robert Halfon, chair of the House of Commons Education Select Committee, for more targeted teaching of financial literacy in schools, are rather putting the cart before the horse.

Without the core mathematical skills, lessons about fixed versus variable interest mortgages, or how student