Czech schools to begin adding financial literacy to the curriculum

 The education system is failing to teach students important information they will need to use in the real world when they are adults.

Czech secondary school students lack sufficient economic and financial knowledge. This makes it hard for them to calculate what impact a high interest rate has, for example, and other basics that are crucial for good financial management.

The non-profit organization Institute of Economic Education (INEV), which organizes the annual Economics Olympiad, wants secondary schools to include financial literacy in their subject matter. The olympiad, now in its fifth year, is the Czech Republic’s largest nationwide student competition focused on knowledge of economics and finance.

INEV director Martina Bacíková told the Czech News Agency (CTK) that on average only about half of the students in the Economics Olympiad had successfully demonstrated financial knowledge in the long term. While over 60 percent of participant were able to answer questions concerning recent political affairs, only about 40 percent were knowledgeable about macroeconomic and financial affairs.

Students in the Liberec and Olomouc regions scored better than those from Prague. Academic high school (gymnázium) students did better than students from other types of secondary schools such as vocational schools.

She said the problems with calculating interest rates are linked to a the lack of quality in mathematical education in the Czech school system.

The results of not understanding finances are more than just academic. Financial illiteracy can lead people into poverty, debt traps, foreclosures, and even political extremism, Bacíková said. Among other things, students should learn not to take to unnecessary loans. They should also learn how to invest for bad times and for their retirement.

Teaching financial literacy as a subject has been tested in 10 Czech schools since September 2021. In cooperation with investment group Leverage, it should be introduced to 50 more secondary schools this September. This is still only a small number of the total. The Czech Republic has some 1,300 secondary schools with roughly 433,000 students.

Experts also say secondary school students do not understand taxes well enough. Mendel University in Brno and the consulting firm BDO want to improve this situation. The Education Ministry wants to use the results of this project to modify the framework of educational programs.

For several years, experts have been calling for the education program needs to be modernized. The current system relies too much on rote memorization of isolated facts, and not enough on critical thinking skills. Students are asked to learn too many pieces of information by heart, but, at the same time, they do not understand things well and do not acquire some important skills, experts maintain.

A revision of the educational programs for elementary and secondary schools is underway and should be completed by the end of next year, according to the new government’s policy statement.

Prime Minister Petr Fiala has a background in education and was a university professor of political science and rector of the Masaryk University in Brno. He has held several other posts relating to education including serving as a member of the Council of the European University Association from 2009 to ’11.