Half of UK adults potentially vulnerable, FCA's Financial Lives report finds

More than 25 million adults are potentially vulnerable, according to a report into people's financial lives from the City regulator.

Half of UK adults, or 25.6 million, show characteristics that signal their potential vulnerability - meaning they may be at increased risk of harm, the Financial Conduct Authority (FCA) found.

Those who are potentially vulnerable may suffer disproportionately if something in their lives goes wrong, the FCA said. They may be less able to engage with the financial services available.

Women are more likely than men to be potentially vulnerable. Some 53% or 13.9 million women fall into this category, compared with 46% or 11.7 million men.

People aged 75 and over, the unbanked - those who have no current account or an alternative e-money account - and the unemployed are also particularly likely to show characteristics of vulnerability, the FCA found.

But it emphasised that potential vulnerability does not mean all people with these characteristics will suffer harm.

Those who are potentially vulnerable may have been left at risk by a life event such as a divorce, redundancy or bereavement.

They may have low financial capability or they may have a health-related problem that affects their day-to-day lives.

The Financial Lives research was based on responses from nearly 13,000 people aged 18 and over.

It covered people's experiences of using financial products and services and managing their money.

The report also found:

:: Single parents aged 18 to 34 are three times as likely to use high-cost loans - at 17% compared with the UK average of 6%.

:: The FCA describes 13% of 25 to 34-year-olds as being in difficulty, because they have missed paying domestic bills or meeting credit commitments in three or more of the last six months.

:: Only 35% of those aged 45 to 54 have given a great deal of thought as to how they will manage in retirement.

:: People aged 65 and over are least likely to check if an internet site is secure before giving their bank or credit card details.

:: 24% of UK adults have little or no confidence in managing their money, and 46% of all UK adults report low knowledge about financial matters.

:: Some 3% of UK adults are unbanked. This means they have no current account or an alternative e-money account. Those most affected are the 18 to 24-year-olds and those over 85 - one in 20 (5%) of each group is unbanked.

FCA chief executive Andrew Bailey said: "The findings give us a wealth of information which will be used to increase our knowledge and understanding of the issues affecting consumers and how to best protect them.

"The data gathered will be invaluable in helping the FCA prioritise our work.

"We also hope that the research will provide valuable insight for other organisations focusing on consumers and finance."