We need a cultural change, not a policy change, to get people to invest more, Rishi Sunak, former prime minister, tells MoneyWeek.
In the debut episode of MoneyWeek Talks, the new podcast which is available on all platforms and to view on YouTube, Kalpana Fitzpatrick talks to the former UK prime minister about why everyone needs to get to grips with maths to ultimately be better with money.
“In government, there is a lot of focus on various policies, but something I have come to realise is that the government can change a lot of policies, tax incentives and regulation, but actually that doesn't move the needle – what you need is cultural change.”
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He suggested people were more likely to start investing if they had more confidence with numbers, and stressed that everyone, of every age, has the ability to be strong with numbers.
Current chancellor Rachel Reeves is reportedly entertaining the idea of reducing the tax-free incentive for cash ISAs in the hope that more people will put their money into stocks and shares ISAs instead. While nothing is confirmed and is unlikely to be until the Autumn Budget, Sunak, who was chancellor between 2020 and 2022, feels more education is needed to get people to start investing and use stocks and shares ISAs.
"There’s a professor at Stanford [professor Lusardi], and she is one of the world's experts on financial education. And what she figured out almost 20 years ago, there are three foundational questions you can ask people to see how financially literate they are.
“One of them is about compound interest, the second one is about inflation and how it affects us and the third is about risk and diversification," Sunak tells MoneyWeek.
The Richmond Project
Sunak is now on a mission to get everyone confident in numbers and believes it will help overcome barriers to financial literacy and boost the economy.
Earlier this year, Sunak and his wife, Akshata Murty, launched The Richmond Project, a charity dedicated to boosting numeracy skills and helping everyone feel comfortable with numbers so they can apply those skills in everyday life.
Everyone can be a numbers person, he says. “We want to break those barriers down”.
While financial education is now set to be part of the curriculum as part of citizenship classes from September 2028, Sunak argues that it all starts with good maths and numeracy skills – with that foundation, people can make better decisions around picking the right mortgage, budgeting and investing.
Tune into the podcast series on our YouTube channel.
Artificial intelligence and financial advice
Last month, tech giant Microsoft and AI start-up Anthropic appointed Sunak as a consultant.
Commenting on whether AI could boost numeracy skills and help people with their finances, Sunak said he thought there was a huge role for AI in boosting access to financial advice, but stressed that, without the confidence to grasp financial concepts and understand that what you are being advised on is correct, getting to grips with numeracy is essential.
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