Should educators talk to their students about credit?

Money makes the world go round, but it can often be a subject that many people don’t feel confident about. In many households, it’s considered taboo to talk about how much you earn and spend, which can make it hard for young people to learn anything about it before they have to go out and manage their own finances.

Additionally, it can be tricky to learn about financial topics such as investing or managing debt, yet these are issues that most of us want to or need to know about in our lives. But whose responsibility is it to educate young people about financial topics, particularly credit? And why is it important? Let’s take a look.

Why is credit an important subject?

Research from debt charity StepChange shows that one in four 18-24 year-olds are in some kind of financial difficulty. These young people are only just out of school, and so it’s concerning that they’re already experiencing hardship. Whether it’s because of low wages, high rent, or the pressure of keeping up with their peers, reliance on credit seems to be becoming part of everyday life for many. So, it’s good for students to be informed about how to handle tricky financial situations before they find themselves in one.

Promoting good financial habits

Talking to students about credit is also a good proactive step that may help them understand money, so they can avoid debt in the first place. By instilling good habits early on in their lives, you can help young adults better manage the money they do have after leaving school, whether that’s through their first job or their student loan. Your lessons could help them avoid tricky financial situations due to a lack of knowledge.

Improving their credit score

Building a good credit score takes time, and the earlier you start, the better. However, many young people only see a credit card as a way to get money they don’t have, or something to be avoided unless there’s an emergency. The reality is that using a credit card responsibly can build up your credit score, putting you in a better position when it comes to something like buying a property, something many young people aspire to do.

Avoiding bad debt

Credit is changing. The rise of buy now, pay later (BNPL) schemes is encouraging many people to buy things they can’t afford, tempting them with small monthly payments that seem reasonable at first glance. Especially in a social media age, where comparison is part of everyday life, it’s very easy for young adults to feel that they need more items, and BNPL schemes don’t have the same scary process that applying for a credit card with a bank does. In many cases, people don’t even realise that BNPL is a form of credit. As an educator, you’re able to properly inform your students about the facts, so that when they make their own decisions, they’re at least doing it with the correct information.

The role of the educator

As an educator, it’s not solely your responsibility to teach young people about credit. That is shared with their parents or guardians. However, you are in a position to share information and boost their financial education, with many teens taking teachers more seriously than their parents. By doing so, you’re setting them up for success with skills for life.

The author

Harriet Young

Harriet enjoys going on hikes and connecting with nature with her two Labradors. Though she enjoys being vegan, she is adventurous and enjoys trying out new food. Skilled in PR, creative media, and content strategies to assist brands and companies in developing and enhancing their online presence. Primary competency: - Market and audience insight - Campaign planning and strategy - Digital initiatives that result in 'earned' media attention that is organic. https://www.thesixthdegree.media

https://www.thesixthdegree.media