15 Jul Why is Aussie kids’ financial knowledge on the decline?
The proposed national curriculum has downgraded it even further, reports Emily Ross and Margaret Marshman.
Financial literacy means having an understanding of financial concepts and risks, and the skills, motivation and confidence to make effective decisions across a range of financial contexts.
In Australia, many young people have trouble with financial literacy, especially young people in lower socioeconomic groups, who live in rural areas or who have a language background other than English.
According to Scott Pape — author of the Barefoot Investor and whose program Money Movement is screening on Foxtel’s Lifestyle Channel — most children don’t learn the necessary financial skills they need at school. More than 100,000 people have signed his recently launched petition to bring a “financial revolution” to schools.
There is no independent financial literacy strand in the Australian Curriculum, but a sub-strand exists within maths. This is clearly not enough. The financial literacy performance of Australian 15 year olds’ in the OECD’s 2018 Programme for International Student Assessment (PISA) financial literacy assessment fell by by 15 points (or half a year of schooling) since 2012.
And yet, the draft of the revised Australian Curriculum downgrades financial literacy even further.
The current maths curriculum includes some content providing teachers with explicit direction to teach fundamental financial concepts. These include representing monetary values, rounding up to the nearest five cents, or solving simple and compound interest problems.
For example, in the current year 10 curriculum, students are required to
Connect the compound interest formula to repeated applications of simple interest using appropriate digital technologies.
This is a clear description of the need for teachers to help develop essential financial maths knowledge and skills.
The Australian Curriculum, Assessment and Reporting Authority in April released a draft of the proposed revised curriculum for consultation. The above year 10 content has changed to students having to:
use formulas involving exponents and real numbers to solve practical problems (including financial contexts) involving growth and decay and solve using digital tools as appropriate.
This wording no longer ensures students are taught about social aspects of, as well as how to calculate, compound interest. Previously it was the teacher’s discretion as to how they taught exponential growth and decay. Currently teachers are likely using transmission of COVID as the context to teach these concepts.
In terms of what students should achieve by the end of each year, the proposed curriculum has also removed explicit mentions to financial literacy. For instance, in the current curriculum, by the end of year 7 students will
[…] solve problems involving percentages and […] operations with fractions and decimals. They compare the cost of items to make financial decisions. Students represent numbers using variables.
In the proposed curriculum, students by the end of year 7
[…] solve problems involving rational numbers, percentages and ratios and explain their choice of representation of rational numbers and results when they model situations, including those in financial contexts.
Again, this doesn’t mean they will learn about financial matters — they might.
Why does this matter?
One aim of the curriculum review is to declutter content. This may be why applications of maths have been relegated to optional status.
By making financial concepts mere examples, the number of content descriptions decreases. This might provide the appearance the quantity of maths has decreased. But teachers still need to provide students with a context in which to apply their maths skills.
Systematically teaching financial concepts in a maths course can improve the financial outcomes of more disadvantaged students. But research shows there is a diversity in practising teachers’ ability to identify and interpret opportunities for teaching financial literacy in curriculum.
If financial literacy is left as an example, not all teachers will see the same opportunities for teaching it and financial teaching will be haphazard across schools, and classrooms.
The issue is further complicated by the fact 38% of maths teachers in years 7-10 are not qualified in maths or maths teaching. Teaching financial maths for these teachers will be much more difficult if there are no explicit guidelines in the curriculum.
After Scott Pape’s lobbying New South Wales announced from term 3 all school children could participate in a “financial literacy challenge” to encourage them to develop positive money habits and increase their financial literacy.
But teachers will still need time to teach these programs. So the elements that have been removed from the curriculum to declutter it will then reappear in the form of additional teaching programs.
The Australian Curriculum provides the content all teachers are required to teach. While many states and territories then reflect this in their own syllabuses or curriculum documents, they all use the national curriculum as the basis.
If the Australian Curriculum doesn’t value financial maths, then other states and territories can choose not to include it.
Once the revised Australian Curriculum is released, other states and territories will begin their processes of redeveloping their own curricula. A structured financial literacy program may need to be created, even more so in Queensland where the national curriculum is adopted as it is written.
We need to ensure the Australian Curriculum keeps the explicit language to embed financial literacy concepts into maths lessons. This way, kids will grow up with the financial knowledge they need to make important decisions and participate meaningfully in society and the economy.
Emily Ross, Lecturer, Curriculum and Pedagogy, University of the Sunshine Coast and Margaret Marshman, Senior lecturer mathematics and physics education, University of the Sunshine Coast