Report: UK teens clueless about credit

By UK CreditCards.com

An alarming number of teenagers in the UK are surprisingly poor at managing their finances, according to a new report from Barclays that investigated young people's attitudes toward cash and spending. Very few teenagers, in turn, have received formal education on how to manage their finances.

teen-parent

The report on teenagers' financial literacy was commissioned by Barclays to highlight the lack of financial knowhow amongst young people.

Teens: Credit cards ‘not real spending'
The Barclays report, which was published in the Daily Mail, revealed that a full third of teenagers who were quizzed by researchers didn't consider using credit cards to be ‘real spending'. A significant number also appeared to know little about personal loans, 0% credit cards, instant credit cards, bad credit credit cards or regular purchase credit cards

British teenagers ‘regularly run out of money'
34% of those questioned by Barclays also admitted to regularly running out of cash. In addition, a third of 22 to 24-year-olds say that they still rely on handouts from their parents to survive.

"As many as one in four unemployed youngsters and 13% of those aged 16 to 24 constantly run out of money," reported the Daily Mail.

Experts say that they are concerned that British teenagers will grow into adults incapable of managing credit cards and other debts. Only 4 per cent of teenage respondents admitted to having received formal financial education from their school or college.

Organisations join forces to promote financial literacy
Action for Children, the National Youth Agency and the National Skills Academy for Financial Services have responded to the problem by joining forces to offer teenagers help with spending, saving, budgeting and managing credit cards.

"It is essential that vulnerable young people are given the best start in life," said Deanna Oppenheimer of Barclays. "Having good money management skills, particularly when faced with a constrained budget, is vital to enhancing their life opportunities and preparing them for independent living."

See related: Study: Many Brits lack key knowledge of credit scores; 4 ways to teach children about credit

Published: 5 May 2011