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Workers need better financial education, says OU Business School survey

The research also revealed that while many employees claim to have a reasonable level of financial knowledge, what they have most recently learned has often been the result of a kneejerk reaction to a major life event, such as leaving school or buying a first property, as opposed to being taught.

Almost half (44%) of those surveyed also confessed that major life events were also the last time new financial knowledge was gained.

As a result of financial education being added to the school curriculum throughout the UK, the situation should improve among future generations, the survey concluded. There is also a clear need for education among the current workforce, with just 7% having received any assistance from their employer.

Four fifths (81%) of the UK workforce admit they would favour help from their employer to understand their finances. A third (33%) stated financial education would help them plan their financial future and 25% said it would help them to understand their pension.

Of the ways employees would like their employer to help them, more than a quarter (26%) favoured one-to-one sessions and 22% would like the option of free financial courses.

In order to tackle the lack of financial education in the workplace the OU Business School, through its dedicated research centre the True Potential Centre for the Public Understanding of Finance, has partnered with Share Radio, the UK’s only national dedicated personal finance radio station, to make the ground-breaking ‘Managing My Money’ eight week personal finance course easily accessible to any employers looking to encourage personal finance education among its employees.

The course, which starts afresh each fortnight, is free and is broadcasted via the DAB station. There are two 25-minute episodes per week, each with an online test.

Following the final, more comprehensive test, students receive a Statement of Participation from The Open University. 

For the first time students will be allowed to name a third party who can monitor their progress and collect their qualification results. Upon completion participants can include the certificate to their CV to further build their job prospects.

Martin Upton, director of True Potential PUFin at OUBS, said: “It is clear that many generations have suffered from a lack of formal financial education, and, while it was finally added to the school curriculum [in England] last year, there is a real need for many consumers to increase their knowledge of, and confidence in, financial matters.

“By 2018 all employers will have responsibility for offering access to pension schemes and there should be guidance on the schemes offered and the desirability for employees to augment their state pensions.

“Assessing how much income is needed in retirement requires budgeting skills and an understanding of taxation. In effect, pension guidance is a stepping stone to wider financial education.”