Information: For Immediate Release Monday 13 September 1999

LEARNING, EARNING AND HOW TO SAVE IT

A strong link has emerged between the age at which we leave school and our ability to understand personal finance. The older we are when we leave, the better our chances of getting to grips with money matters.

This has been drawn from the Association of Unit Trusts and Investment Funds’ (AUTIF) ongoing Financial Awareness and Consumer Education Tracking Study (FACETS). The study, which is carried out each month amongst 1000 people, tracks the ability of the population as a whole to answer a range of basic personal finance questions.

Anne McMeehan, Director of Communications at AUTIF, commented:

"At first glance it’s scarcely surprising that there should be a difference in financial awareness shown by those who left school at 13 or 14 and those who went on to finish some years later. Nevertheless, there is also a marked and entirely disproportionate ability demonstrated by the late leavers in comparison with the lack of understanding shown by those who left school early."

The Government has recently announced changes to the school curriculum for 11 to 14 year olds, including methods to help improve levels of financial literacy as well as teaching children how to develop healthy and safer lifestyles.

Victoria Nye, Director of Training & Education at AUTIF and Head of Communications for the pfeg, added:

"The Government’s initiative is to be applauded. If people are to be equipped to take charge of their financial responsibilities, the spark has to be kindled as early as possible. All too often financial matters are put off as something to be dealt with tomorrow – by which time, all too often, it’s too late."

Example Using the 13-14 age group: 9% of the correct answers were given by 13% of the survey population. In theory, 13% should have given 13% of the correct answers. 9% of 13% is 68%, giving an underscore of -32% (100-68=32).

AUTIF provides a range of free consumer guides to saving in investment funds, including The Handbook which won the Money Management Council Award for excellence in information on financial services. Readers should telephone +44 (0)20 8207 1361 to obtain copies. These guides can also be found on AUTIF’s website, www.investmentfunds.org.uk

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For further information, please contact:

Anne McMeehan, Director of Communications - AUTIF - +44 (0)20 7831 0898
Clare Arber, PR Manager - AUTIF - +44 (0)20 7831 0898

Notes to Editors:

1.  The personal finance education group (pfeg) was founded in December 1996 to bring together financial service industry representatives, regulators, Government officials, consumer representatives and educationalists, united in the belief that it is important to educate young people about financial matters so that they are able to make independent and informed decisions about their personal finances and long term security. Their website address is www.pfeg.org.uk

2.  *FACETS (Financial Awareness and Consumer Education Tracking Study) is sponsored by the Association of Unit Trusts and Investment Funds (AUTIF) and is a cross-population study based on independent data collected by RSL, one of the largest operations working in this area and a leading exponent of computer assisted personal interviewing; and is then analysed across a wide range of socio-demographic splits using MarketMinder (For further details contact Mike Hare - MarketMinder - Tel: 01778 345588)

3.  Each month a sample of 1000 people is filtered to isolate those responsible for making financial decisions. It is rigorously selected to reflect the balance of the adult population by sex, age, socio-economic group and geographical location. People are interviewed on a face to face basis to ascertain their understanding of basic personal finance matters that are likely to affect them.

4.  There are 14 questions asked each month covering a wide range of personal financial topics. They are the same questions and do not change unless circumstances specifically demand it, in which case they are replaced by a question of similar weight and where a lack of understanding or appreciation will have similar implications for people's financial security. As this is an ongoing survey these are 'live' questions and therefore their precise nature and phraseology is not open to general disclosure. Members of the press may see them on request for their own appreciation but are strictly not for publication for fear of interfering with the research.

5.  The questions are asked to establish a True, False, Don't know response, thereby establishing a number of measurement tools. The main AUTIF FACETS index is based on knowledge, i.e. those questions that are correctly answered. In addition AUTIF is in a position to measure the level of misunderstanding, i.e. where the answer given is wrong, the level of ignorance where the answer is 'don't know' and if the last two elements are combined to form a composite, the understanding 'gap' can be monitored. Furthermore, this can be carried through to assess understanding on an individual question basis and to measure any improvement that can be isolated to specific segments of the population.