National curriculum reforms designed to encourage school pupils to develop "life skills" will do little to raise worryingly low levels of financial literacy among young people, an education charity has warned.

Shakespeare, the history of the slave trade and healthy cooking classes were all decreed compulsory by Alan Johnson, the education secretary, yesterday but practical lessons in personal finance, budgeting and mortgages will remain voluntary.

Gavin Shreeve, chief executive of the IFS School of Finance charity, said: "If you don't make something structured and compulsory it just won't happen. And that's a tragedy because if you look into the cause of so many social problems in our society it nearly always comes down to a fundamental mismanagement of money."

The new modules published by the Qualifications and Curriculum Authority advise schools how to teach economic concepts such as competition and price efficiency, as well as practical lessons on interest rates, money management and credit cards. However, the QCA said the subject should be taught in the personal, social and health education strand of the curriculum, which schools are not legally obliged to follow.

The Personal Finance Education Group, a national charity, said it welcomed the fact that personal finance had been given a higher profile, but "would have preferred it to be part of the statutory curriculum".

A recent survey of 18- to 40-year-olds carried out by the Financial Services Authority uncovered widespread ignorance about basic financial matters.

Yesterday, Mr Johnson said new technology had made it all the more important for young people to understand personal finance. "The 'Ebay generation' is the first to be able to buy and sell anything, any time, anywhere, at the touch of a button," he said. "It's more important than ever that today's school pupils understand how to manage the benefits, responsibilities and risks of making, borrowing and spending money."

George Osborne, the shadow chancellor, has said all school pupils should learn about personal finance but has not said whether the Conservatives would make it compulsory. Yesterday, David Willetts, shadow education secretary, said there was a questionmark over whether there were enough trained teachers to deliver personal finance lessons.

The QCA review of the secondary curriculum will run until the end of April, with changes taking effect in schools from autumn 2008.

Mr Johnson said he would use his powers to protect traditional "classic" subject areas, such as Shakespeare's plays and works by authors such as Charles Dickens and Jane Austen. The two world wars, the Holocaust and the slave trade will be compulsory in history lessons.

Schools will also get more freedom to teach "more economically useful languages such as Mandarin and Urdu" rather than traditional European languages. The National Centre for Languages welcomed the greater scope, but said there was no evidence that European languages were less economically important than any other.