Parents should lead by example in money management

Parents should lead by example in money management

Most UAE teachers want financial literacy to be taught in schools. But given the Middle East’s looming debt crisis, money management will also have to figure on the curriculum at home.

March 14, 2010 3:50 by kippreport

The vast majority of UAE education professionals believe that money management should be taught in schools, according to a recent survey by Visa.

Out of 100 teachers polled, 73 percent said their schools did not currently teach basic money skills, with 95 percent expressing a wish for it to be made part of the curriculum.

Visa, predictably, has an answer to this. The payment technology provider has set up a financial literacy website called MyMoneySkills, which has information on how to plan a budget, spend responsibly and (again, predictably) use a credit card wisely.

Despite the obvious agenda on behalf of Visa, the issue of financial literacy among the Middle East youth population is indeed an important one.

For example, the recent Arab Youth Survey found that more than a quarter of Arab youth have some form of personal debt, the majority of it owed on credit cards. In Saudi Arabia, for instance, 52 percent of residents aged 18-24 are in debt, and 66 percent of these have credit card debts.

It is easy to see why the vast majority of UAE teachers want financial literacy to be taught in schools. But most parents need a lesson in it, too. Aside from the Arab Youth Survey, a far more alarming piece of research reported that families in Saudi Arabia spend almost twice what they earn. According to Kuwaiti economist Jassem al-Mutwwa, “education, amusement and eating out account for more than 181 percent of a family’s income in Saudi Arabia”.

So there’s little point in educating students on money management, when their parents continue to spend beyond their means. Adults need to practice what they preach; a two-pronged education drive is needed in order to stem the Middle East’s looming debt crisis.