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Learn to get yourself out of debt

Personal finance experts embark on new mission to help Brits save themselves from an uncertain financial future...

Personal finance issues are rarely out of the headlines and it's easy to see that the population of Britain is suffering from a growing debt bill: UK personal debt hit £1,237bn in July 2006, an increase of £105bn in 12 months. The average household in the UK now has unsecured debt of about £8,577, and average consumer borrowing via credit cards, motor and retail finance deals, overdrafts and unsecured personal loans has risen to £4,506 per average UK adult. And research reveals that pension funds have lost up to 75% of their value.

Many face an uncertain future, thanks in part to a lack of planning, and may even have to survive on credit when they reach pensionable age. But the future now looks brighter for those keen to pursue a more stable future, as the Open University embarks on a mission to educate people as to the pitfalls of debt. An innovative new course - You and Your Money: Personal Finance in Context - aims to put the consumer firmly in control of their decision-making in money matters by providing them with a thorough grounding in financial literacy.

Already, 600 people have enrolled on the course which begins next month. It draws upon some of the most common issues affecting consumers - borrowing and debt, planning for retirement, family finances, for example - and will develop consumers' practical financial skills. Rarely has the issue of financial literacy been higher on the social agenda, as financial behaviour of some shows worrying trends in, for example, failing to plan for their retirement, being unable to live within their monthly or weekly incomes, and failing to plan for unexpected events such as significant drops in income. Recent research estimated that four million people - spread in proportion across high- and low-income earners - always run out of money at the end of the week or month.

Four broad themes are the focus of the course:

the importance of the changing economic and social environments to personal finances;
the relationship between individuals and households in financial matters, including couples managing their money, the financial implications of having children or caring for an elderly parent;
the importance of change over time on income and spending plans;
financial planning, including the use of personal balance sheets, budgeting and cashflow statements

Course chair Ian Fribbance, of the University's Faculty of Social Sciences, said the need for financial education was at "an all-time high". "Financial capability is a major social objective for the Government and the introduction of this new course signals our commitment to improving financial literacy. The knowledge and understanding people gain from studying You and Your Money will provide them with skills that are highly practical and relevant in their everyday life," he added.

"You and Your Money will equip students with a better understanding of the world of personal finance. It will develop their skills to allow them to better manage their money, ultimately enabling them to make educated choices to avoid debt pitfalls. Importantly, the course places the study of personal finance firmly within the broader social and economic background - having an understanding of this background will give people a fuller understanding of the subject matter and will better prepare them for financial planning."

"Sadly we're a nation being educated into debt when we go to university, but never educated about debt - is it any surprise there's now over a trillion pounds of borrowing. There's a desperately pressing need for people to learn more about money, and it warms the cockles to see the OU launching a course. In our society companies spend billions a year on advertising, marketing and sales training, but we consumers get very little buyers training - everything that helps redress that balance is a warmly welcomed step," says Martin Lewis, TV money guru.

Leading experts and authors from financial services joined staff from the University's Faculty of Social Sciences and OU Business School in developing the course.

Personal finance planning tools are included in the course materials, which also include print, DVD-Rom and website material. A personal tutor is available to provide advice and guidance with studies.

Potential students looking for more information can log in at www.open.ac.uk, call 0870 333 4340 or email general-enquiries@open.ac.uk. The course fee for UK students will be £295. Financial support, dependent on household income, may be available for students across the UK. Closing date for registrations is October 23.

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