The Money and Pensions Service launches its UK Strategy for Financial Wellbeing
22 January 2020
The Money and Pensions Service (MaPS) has launched its UK Strategy for Financial Wellbeing. This outlines its ten-year vision and how it aims to improve the lives of millions by setting goals across five key areas – financial education, saving, credit, debt advice and retirement.
MaPS brings together three guidance bodies – the Money Advice Service, the Pensions Advisory Service and Pension Wise, and its mission is to ensure that everyone in the UK can access the relevant information they need in order to enable them to make the correct financial decisions, throughout their lives, with ease.
Successful delivery of the strategy will mean that the lives of many will be improved, which will in turn benefit communities, businesses, the economy and wider society.
Five “agendas for change” have been established and include the goals to be achieved by 2030. They are as follows:
- Financial foundations – 6.8 million children and young people to receive meaningful financial education – an increase of two million from 2019, when 4.8 million children received this guidance
- Nation of savers – 16.7 million working-age people classed as ‘struggling’ and ‘squeezed’ will be saving regularly – an increase of two million
- Credit counts – Two million fewer people frequently using credit to pay for day to day expenditures such as food or bills
- Better debt advice – Two million more people receiving the debt advice they need. At present, only 32% of those requiring debt advice access it
- Future focus – Five million more people with a sound understanding of how to plan for their retirement and later lives, meaning that a total of approximately 28.6 million people will have this awareness
The strategy will also investigate which factors mean that certain individuals are more vulnerable to financial difficulty than others, for example, gender and /or mental health conditions. MaPS will work in conjunction with other organisations and experts across all sectors to deliver the strategy.
Financial wellbeing means that individuals can afford to pay for day to day life without concern and can cope with the unexpected expenditures that life sometimes demands. It is primarily about feeling secure, in control, confident and empowered. The requirement for the strategy was identified because poor financial wellbeing has a wider effect and impacts on the mental and physical health of individuals, as well as their relationships with others.
Research shows that:
- 11.5 million people in the UK have less than £100 in a savings account
- Nine million people rely on credit to pay for food and important bills
- 22 million people are not prepared for and cannot plan for their retirement
- 5.3 million children are missing out on beneficial financial education
Good financial wellbeing means that individuals are more productive at work and is good for companies as they have customers who repay their bills and payments. Additionally, it is not just individuals who benefit from people being able to invest money in their retirements – it also has a positive effect on the wider economy.
Over the course of the first half of 2020, MaPS will work alongside leaders and experts from the public, private and voluntary sectors to establish developed plans for the five goals and how they will be implemented in England, Scotland, Wales and Northern Ireland. Once this has been achieved, MaPS will focus on tailoring its own corporate strategy to ensure that it can continue to provide crucial money and pensions guidance to its customers.
The Acting Chief Executive of MaPS, Caroline Siarkiewicz, commented:
“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.”
Chair of the money and pensions service, Sir Hector Sants, 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 ground-breaking digital pensions dashboards which will transform how all of us plan for retirement.”
For further information, stakeholders should visit the Money and Pensions Service website at www.moneyandpensionsservice.org.uk
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