Four out of 10 adults aren't in control of their finances
Did you know one in five people can't read a bank statement and four in ten adults have less than £500 in savings?
The findings are today revealed as part of major research into people's ability to manage their money.
It also suggests around four in 10 adults aren't in control of their finances, and that financial capability remains stubbornly low - which is why today the Money Advice Service and partners from the financial services industry are launching a UK-wide initiative.
We asked David Haigh, our Financial Capability Director, to tell us more.
Financial Capability Strategy – what does it all mean?
Today we have published a 10-year Financial Capability Strategy which aims to improve people's ability to manage money well day to day, prepare for and manage life events, and deal with financial difficulties.
Its focus will be on developing people's financial skills and knowledge as well as their attitudes and motivation.
Based on extensive research among 5,000 people and consultation with key organisations and institutions, the Financial Capability Strategy spells out in stark terms the problems the nation faces and the approach we must take to resolve them.
Among our findings, we found 21 million of us don't have a modest £500 in savings to cover unexpected bills like replacing the fridge or mending the car, and 19 million don't have an approach to budgeting that they feel works.
Around 8 million people in the UK currently have problems with debt. However, of those, just one in six is seeking help.
'Spend today rather than save for tomorrow'
These findings show a worrying 'spend today rather than save for tomorrow' culture, limited financial resilience to deal with unexpected life events, and financial difficulties that are closely associated with mental health problems.
Our strategy focuses on every key life stage and challenge, from children and young people to retirement planning and older people.
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The strategy is built around two key concepts – collective impact and cross-sector co-ordination rather than isolated interventions; and testing and learning to determine what works in order to deliver evidence-based interventions.
Resources will be steered towards activities on the basis of what is proven to work.
Specific actions for the devolved nations will be delivered in Scotland, Wales and Northern Ireland.
We are calling for a fully collaborative approach over the next decade to make sure we achieve our goals.
Read the UK Financial Capability strategy in full.
Steps for improving your financial capability
One way is to keep track of your money. Our research showed 20% of people often buy on impulse, but it's important to be able to track the impact of what you're spending.
Our Budget Planner can help.
Find out what's left after major bills with our Budget Planner
It's also important to talk about money. Money can appear to be a taboo subject, but talking about it can help you keep track of it. More than half (53%) of people keep up with bills without difficulties if they talk to their partner about money, compared to 48% of UK adults overall.
How to talk about money with your partner – effectively
This article is provided by the Money Advice Service.
