Debt problems can be exacerbated by poor maths skills as consumers fail to understand the terms under which they are borrowing money, it has been claimed. According to the chief executive of education company Whizz.com, there is a basic element of mathematics involved in all personal financial dealings.
"It's a combination of not understanding the repercussions of borrowing money at a high interest rate and not understanding the effects of compound growth," said Richard Marett, pointing out that borrowing on a credit card at 15 percent per annum can quickly become problematic if consumers do not realise how much they will be charged if they fall into arrears.
However, he added that while poor maths skills undoubtedly play a part, many people who get into financial difficulty do so simply by burying their head in the sand. Indeed, borrowing money and not considering the consequences further down the line could cause debt problems to spiral out of control.
His comments come as Liberal Democrat leader Nick Clegg is calling for financial literacy to become a part of the maths curriculum in schools. He claims that teaching young people how to manage their money will help to overcome Britain's addiction to debt.
