Get a clue about cash

21st September 2007 at 01:00
When it comes to money, black is the new red. Get yourself out of debt and start dividing your assets more wisely. Alison Brace tells you how

Are you bemused by the numbers on your payslip? Do they look about right, but if anyone quizzed you about their true meaning you would be reduced to a blubbering idiot?

How about mobile phone tariffs or current account interest rates? Worry not if it is all gobbledegook to you. You are not alone. It appears we Brits, professionals or not, are the least savvy in the Western world when it comes to money matters.

Eight out of 10 us don't know our APRs from our elbows according to a MORI survey for the ifs (formerly known as the Institute of Financial Services) School of Finance. (That's Annual Percentage Rate, by the way.) And research by the charity Credit Action shows that a quarter of Britons have no idea how much they spend in a week or what their monthly cash flow is.

It's hardly a surprise then that the UK's levels of saving as little as 21p in every pound;10 are the worst in Europe or, indeed, that UK consumer debt grows by pound;1 million every four minutes.

And yet we all know that getting to grips with money issues is the key to making that hard-earned cash go further. So, perhaps it's time to give your financial know-how a new-school-year makeover.

You might be passing your days instilling vital life skills into hungry young minds, but maybe it's time to brush up on your own. The ifs School of Finance, the only provider of GCSE, AS and A-level equivalent courses in personal finance for schools and colleges, has this month launched a similar course aimed at adults.

"We have worked in schools for many years to ensure that young people gain skills to make informed financial decisions, but we became increasingly aware that something also needed to be done for adults struggling with their finances," says Rod McKee, head of financial capability at the ifs School of Finance.

"Somehow it has become socially acceptable to be up to your neck in debt because so many people are. And yet the general lack of financial capability in the UK is not only damaging to the individuals concerned, it affects their families, friends and the communities in which they reside."

The course called Programme in Personal Financial Planning is the equivalent of a GCSE and is currently available at 30 FE colleges. The core unit involves 30 hours of study time, by the end of which candidates should be able to make basic financial planning decisions, and generally be able to budget more wisely.

If fitting in a weekly visit to a college in the evening is not possible, then there is a similar course run by the Open University, called You and Your Money. The next course runs from this November to May 2008 and costs Pounds 315. This course looks at how best to plan your everyday finances as well as the broader social contexts that affect our decisions about money.

Maybe we just need to turn back the clock to relearn some key lessons about living within our means. In 1861, the average Briton saved pound;9.45 a year, according to the Post Office. That's the equivalent to pound;445 today. And yet today, when we are generally much better off, we manage to save just Pounds 172.

Even scarier is that one in four people doesn't save anything at all, and yet seven in every 10 still manages to buy a lottery ticket each week. It's time to stop living on the never-never and seize control of your cashflow. Take some lessons from the experts

For info on the ifs course, call 01227 818 609 or see www.financialcapability.co.uk

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