Credit, Collections & Insolvency News
The Government is set to roll out a financial wellbeing programme designed to turn UK into a ‘nation of savers’ by 2030. The Money and Pensions Service (MaPS) says that the initiative will see an extra 2 million people saving regularly within a decade, while 2 million fewer would be using credit cards for day-to-day spending. This comes as analysis shows that 11.5 million consumers have less than £100 in savings.
The UK Strategy for Financial Wellbeing establishes five ‘agendas for change’ and sets goals to be achieved by 2030. These are:
The strategy will also examine factors which can make people particularly susceptible to financial detriment, such as mental health conditions and gender. It will be delivered in collaboration with a broad range of organisations and experts from all sectors.
MaPs says that poor financial wellbeing has knock-on effects for our mental health, physical health and relationships with their research finding that:
People who enjoy good financial wellbeing are more productive at work, and businesses also benefit from having customers who can afford to keep up with bills and payments. Individuals and the wider economy benefit from people being able to invest money for retirement.
Caroline Siarkiewicz, Acting Chief Executive of the Money and Pensions Service said “Financial wellbeing underpins personal health and happiness but it doesn’t happen by chance. We’re launching a strategy for entire lifetimes, aiming to expand financial education for children while ensuring everyone is equipped to plan for and enjoy their retirement. Key initiatives include increasing the availability of affordable credit, more payroll savings products and an expansion of free debt advice for when people are in crisis.”
“The Money and Pensions Service will be the catalyst for a financial wellbeing movement, transforming how people engage with their money and pensions. We have a decade to make a difference and we cannot achieve change alone, so we will be connecting companies, charities and other organisations which share our vision, to make this happen.”
Sir Hector Sants, Chair of the Money and Pensions Service said “The UK Strategy sets out our ambition to transform financial wellbeing over the next decade. The importance of financial wellbeing is under-appreciated. It is not only about financial capability but also feeling secure, in control, confident and empowered in relation to money. It is central to personal wellbeing and thus to living a contented life.”
“The UK Strategy for Financial Wellbeing will only be successful for individuals if it is supported by the right products, regulation, services and corporate culture. Achieving the strategy will thus require the support and, in many cases, action by both the private and the public sector.”
Guy Opperman, Minister for Pensions and Financial Inclusion, said “The Government wants to make it easy for those who need it most to get help to make confident financial choices. The one-stop-shop Money and Pensions Service’s free, high-quality, impartial information and guidance delivers exactly that.”
“Also, it has an important part to play in helping today’s young people become tomorrow’s savvy savers, and the development of groundbreaking digital pensions dashboards which will transform how all of us plan for retirement.”
MaPS says that it will begin work with leaders and experts from across the public, private and voluntary sectors to set out clear delivery plans to achieve the five goals, with specific plans for England, Scotland, Wales and Northern Ireland. Following this mobilisation phase, MaPS will develop its own corporate strategy which will define how the organisation will activate the UK Strategy and continue to deliver on essential money and pensions guidance and services to its customers.
Helen Undy, Chief Executive of the Money and Mental Health Policy Institute, said “People with mental health problems are more than three times as likely to be in debt, debt which in turn can devastate our mental health. We’ve long called for mental health to be central to efforts to improve the nation’s financial wellbeing, and we’re delighted to see the new strategy reflect that today.”
“We also welcome the pledge to help two million more people access debt support by 2030, which should hopefully ensure that more people affected by money and mental health problems can get the support they need.”
Stephen Jones, Chief Executive of UK Finance said “Improving the financial wellbeing of consumers and wider society is a key priority for the banking industry and we support the Money and Pension Service’s (MaPS) ambitious plan and the five priorities it has identified.”
“We have already commenced work with MaPS and we look forward to tackling the priorities with them to ensure that the industry delivers positive changes to help their customers.”
James Jones, Head of Consumer Affairs, Experian said“We welcome MaPS new financial capability strategy and look forward to working with them to implement it, to help improve everyone’s financial wellbeing. Sometimes just small changes can make the world of difference, whether it’s setting your financial goals, reviewing your income and spending and drawing up a budget, or shopping around for better deals on credit, energy and insurance.”
Becky O’Connor, Personal Finance specialist at Royal London, said “The road out of debt and towards healthy long-term savings is a marathon not a sprint. The MaPS ten-year vision may seem like a long timeframe, but is realistic given people’s limited means and the extent of debt dependence in the UK. Alongside this national initiative, we can all do a bit more individually to apply the principles of strong budgeting, goal setting and good habits to our finances.”
