Playing your cards right

Feb 7 2006 By Evening Gazette

It's nice to know that top experts agree with you.

Just a couple of weeks ago I said I believed that people should be made more savvy when it comes to running their own finances.

Schools, I said, should be teaching pupils how to run a bank account, take out loans and how to balance their books, as a means of helping people avoid drowning in debt.

Well, now R3 - the Association of Business Recovery Professionals - is calling for the government to ensure that young people leave school with skills in how to manage money and debt - particularly credit cards.

The demand came as new figures showed personal debt problems have reached an all-time high in the UK.

Julian Gill, R3 North-east regional chairman, said: "Personal debt is out of control in this country."

He added: "If companies cannot lend more sensibly, it is up to the government to help people to manage their debts better themselves.

"We can make a start in schools but we also need to find a way to help and educate adults."

R3 said that, while a start has been made by introducing finances as an element of the National Curriculum, it does not deal with debt, how to avoid it and the need to plan for repayments.

Joanne Hankey of the Bankruptcy Advisory Service, said: "They (young people) must learn to understand that borrowing beyond your means is wrong, whatever a lender thinks is OK, and that they need to know what they can afford. It's not unusual to see people earning £1,500 a month and running up more than £40,000 debt on ten or 15 credit cards."

That kind of financial overspend makes frightening reading and, as Joanne said, it stands to reason they are never going to be able to pay off that debt.