Credit history, Read said, is another area where misconceptions abound. “Young people are often unaware of the importance of basic factors such as registering on the electoral roll, making sure all commitments are up to date—even mobile bills and utilities,” he shared, pointing out that these seemingly minor financial behaviours significantly influence lending decisions.
Perhaps more fundamentally, Read stressed that young people need to understand that the first home does not need to be the forever home. “It’s just the first rung on the ladder,” he said.
For Read, a comprehensive mortgage curriculum should cover loan-to-value ratios, the importance of credit ratings, and the distinctions between leasehold and freehold properties. Understanding what makes an attractive applicant to a lender is equally important, he said.
Hannah Bashford (pictured top right) of Model Financial Solutions, emphasised the importance of teaching financial literacy among children at an early age. “A new University of Michigan study found that children as young as five already had distinct emotional reactions to spending and saving money, and that these translated into actual, real-life spending behaviours,” she said. “It is essential for this education to start in key stage 1 and build on it as children grow older.”
However, Bashford, who herself has written a curriculum for financial services that teaches about money, taxes, charity giving and entrepreneurship, believes the rise of social media presents additional challenges. “With the rise of social media, there is a plethora of misinformation,” she noted. “We aim to provide a reliable, accurate educational framework so children can access correct information and make informed decisions about their finances.”