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This article is part of the FT Financial Literacy & Inclusion Campaign’s seasonal appeal. The appeal is supported by lead partner Experian which is generously match-funding other donations.
The writer is a Labour MP and economic secretary to the Treasury
There are many ways that education and training prepare you for life. Schools teach children to read and write, how to prepare food and eat healthily and about relationships and standards of behaviour. For some everyday adult activities, specific training is required: drivers, for example, must pass both a theory and a practical test.
Yet, while financial choices pervade our lives — and increasingly complex ones at that — financial literacy is not treated in the same way.
In a modern economy, it is a core life skill. The ability to manage money safely and confidently underpins independence and opportunity, just as reading, writing and arithmetic do.
Financial services are not abstract or remote. They shape everyday experiences — from paying a bill safely online or insuring a home to taking out a mortgage or building a pension. Used well, they smooth income, spread risk and turn work into long-term security. But too many people are not equipped to use these tools fully or can’t access them.
The result is a widening gap in financial resilience. Some households can absorb shocks — a broken boiler, say, or an unexpected bill or a short spell out of work — because they have savings, insurance or access to affordable credit. Others find that even modest disruptions quickly escalate into crises. When this happens at scale, it is not just individual lives that are constrained; economic potential is lost.
That is why financial literacy and inclusion matter — and why the Financial Times’ campaign is so important. It is also the thinking that underpins the government’s first Financial Inclusion Strategy. This is grounded in a simple principle: exclusion makes what most of us consider basic everyday tasks harder. Plans become precarious, setbacks escalate and ambition narrows. Inclusion, by contrast, turns shocks into manageable obstacles and allows aspiration to become progress.
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Our plan spans six areas — from banking access and digital inclusion to savings, insurance, credit, debt support and education — that reflect the realities households face. One early outcome, working with Shelter, is to help people experiencing homelessness open bank accounts without a fixed address. This can be the first step towards work, housing and stability — a small change with outsized effects.
But one of the most forward-looking elements in the strategy is financial education. If financial services are part of the infrastructure of everyday life, education is how we ensure people can use it safely and effectively. That is why we are making financial education compulsory at primary schools in England.
This is a significant and deliberate shift. Confidence and habits form early; gaps in financial skills widen over time if not addressed. Teaching children how to budget, save, understand risk and recognise danger lays foundations that last a lifetime. Many adults know the consequences of lacking it.
We should acknowledge too that these gaps are not evenly distributed. Women, some ethnic minority groups and people from lower-income backgrounds are more likely to report lack of confidence in managing money and less activity saving and investing. Early intervention helps prevent this divide from becoming entrenched.
In today’s world, digital skills are now central. Managing money increasingly happens online, and the same is true of fraud. Teaching people how to pay safely, protect their data and spot scams is core to financial literacy, not an optional extra.
A country where opportunities abound, where aspiration thrives and prosperity is sustained, needs improved financial literacy and inclusion. By strengthening the foundations — through access, education and confidence — we can ensure that everyone has the tools for modern life and make Britain more prosperous to boot.
