It’s a sex thing, an age thing, a class thing. People throughout the UK are losing money because they are bad at mental arithmetic – even when they are given the right answer! Barely half can work out how much they should be paid in overtime or the interest on a simple loan. Even the change from a fiver baffles more than one person in five.
These shocking results come from a recent nationwide survey done for the BBC by ICM research. It found that women are worse than men and pensioners are worse than young people. People who are better off and better educated are – perhaps inevitably – better at doing sums in their head. But the good news is there is no North-South divide. People in the South of England are just as bad as those in the North!
The survey asked 1000 people around the UK to answer some simple questions. And all they had to do was pick the right answer from three they were offered. The easiest question was this.
How much change would you get if you bought something costing £2.54 and paid with a five pound note?
More than one person in five either got that wrong or refused to answer, even though they were offered a choice of £2.44, £2.46 or £2.56.
Checking your change in a shop is the most basic personal finance skill. Nowadays of course, the cash till will normally work it out and show the answer. But you should still check your change – or at least be able to. The shop assistant could be pocketing a bit. Or may have entered the wrong numbers. Even on this question, men were better than women. About four men out of five got it right but only three women in four. The worst results were the over 55s – only about 7 out of ten got it right. And they used to cope with pounds, shillings and pence!
The next question was about pay. Do you check yours? Many of us think it’s all done by computer so it must be right. Not so. Computers are only as good as the information they get. If someone keys in the wrong amount, that neat printout will authorize the wrong payment. And not all of us work for people who use computers. Some of the bosses who may be most likely to diddle us do not bother to spend the money on them. Here is the question that barely HALF of us could answer.
You are paid £8 an hour and work 2 hours overtime at time and a half (one and a half times what you earn an hour) how much extra will you earn?
If you earn £8 an hour, overtime is time and half so that is £12 an hour and two hours is £24. It is simple when you know how. But even when faced with the three answers £12, £16, and £24 only 57% of us got it right. Frighteningly, about one person in six would have accepted £12! And nearly one in ten would have taken £16. I’d like to be their boss! A massive one in five women did not even attempt a guess between those three answers.
The sex difference is very interesting. On each question more women than men said they did not know or refused to answer. And there is a big issue here. Women are not by nature worse at doing sums. Some women are brilliant at maths. But many women lack confidence. A colleague of mine told me that her mum often said to her as a child ‘Oh you’ll never be any good at maths. I’m hopeless at it.’ And she believed her – well you do believe your Mum don’t you? But when it came to doing these three questions she easily got them all right.
So people with daughters particularly should make sure that numbers are fun, not frightening. And never ever tell any child you love that they are ‘bound to be hopeless’ at arithmetic. Apart from anything else, it’s just not true. With the right teaching – and that means parents and grandparents as well as teachers – we can all do maths. And help is at hand. The BBC has just published free booklets and information to help parents of primary school children improve their own maths and see how best to help their kids with their homework. Ring 0800 100 900 for your copy. And you can look at a free CD ROM at libraries and schools with East Ender Patsy Palmer as your guide.
Now if adding up is hard, and multiplying is a bit daunting, percentages can be very frightening. The very word has many people laughing nervously. But all of us nowadays borrow on a credit card, or from the bank, or we have a mortgage. Just as many of us put our money in a savings account of some sort. And the money we pay – or the interest we earn – is always calculated as a percentage. So we have to know what they mean. Try this one.
If you are paying 7.5% interest per year on a loan of £200, how much interest will you pay in a year?
Of course, interest calculations can be difficult so this one was designed to be among the simplest and the most basic. But only two out of three men got it right (£15) and less than one in two women. That means that when a sales person sees a woman customer approaching, they know they can fool half of them about interest rates. Twice as many women as men refused to answer at all - more than one in three of them simply said ‘don’t know’. And even better news for the sales people is that one in fourteen people would have been happy paying twice as much - £30 a year.
And the older readers need not look so smug either. Those aged 55 or more did the worst – well under half got it right and nearly four in ten did not answer at all. No wonder financial services companies like targeting the grey pound! So all this nonsense about the way arithmetic is taught in schools could be just that – nonsense. The older generation – aged 55 or more - who went to primary school well before 1960, were the worst age group on every single question. The 18-24s did better than them. The stars of the show were the 25-44s – the best age on all three questions. And when were most of them at school? In the trendy seventies.
So not being able to do arithmetic is costing us plenty. Can’t work out how much you should be paid? The boss could be diddling you. Won’t check your change? The shop assistant could have got it wrong. Don’t know percentages? You could be paying through the nose. Now it may be too late for us – though all of us can improve. But it’s not too late for our kids. So make sums fun. You owe it to them. And if it makes us a bit better at arithmetic, then that could mean a cash bonus for us – in a shop, in a bank, or even in our pay packet.
Ring 0800 100 900 for your free information pack. Go to your local library or school and look at the CD ROM with your guide – Patsy Palmer. Get more information by logging on to www.bbc.co.uk/countmein
November 2000
e-mail Paul Lewis on paul@paullewis.co.uk