A recent report has found that three-quarters of UK adults fall below the benchmark for financial literacy.
The survey saw Brits questioned on a range of topics including ISAs, investing, and general personal finance, revealing both an age and a gender knowledge gap.
With little financial education in schools, maths is set to become a major battleground in the run-up to the next election.
In the meantime, instilling positive financial habits is key, whether you’re a money novice or a financial pro. The financial advice you receive from HA&W could help to improve financial literacy for you and your family.
Here’s how.
A recent survey highlights age, gender, and geographical gaps in financial literacy
IFA Magazine recently published the results of a nationwide financial literacy survey. It found that just 27% of Brits passed the test – achieving a score of 50% or more.
The survey looked for passes in three main areas:
- Investing (40%)
- ISAs (34%)
- General personal finance (28%)
After more than a decade of poor savings rates, it makes sense that investing should be high on the agenda for UK adults, but it doesn’t explain the record inflows into Cash ISAs seen at the start of this year when inflation was even higher than it is now.
Money Marketing recently reported savers put more than £9 billion into Cash ISAs between April and June 2023, the highest inflows recorded since ISAs launched back in 1999.
A lack of knowledge in the area of general personal finance is also worrying.
The survey also revealed the extent of the gender literacy gap, with 31% of men achieving a score of 50% or higher, compared to just 24% of women. In April 2022, you might have read ‘Revealed: Why rising inflation is set to widen the gender investment gap’ but this survey suggests the problem is wider.
An age gap also exists. The over-55s came out on top, with 35% topping the benchmark of 50% compared to just 17% of those aged 18 to 24. The report also found that Southampton was the UK’s most financially literate city with Glasgow the least.
The question, though, is what does all this mean for you and your loved ones and your long-term financial plans?
Financial literacy is about more than economic returns
At HA&W, we look to provide long-term financial solutions to help you achieve your goals. Through decades-long relationships, we hope to get to know you and your aspirations, helping you to gain important financial knowledge along the way.
This helps you to gain financial literacy, and financial wellbeing in three key areas:
1. Improved confidence
The plan we put in place will be based on your individual circumstances now and where you would like to be in the future.
A long-term relationship with a trusted adviser can help you to feel in safe hands and confident throughout that journey, up to the point you achieve your goals and beyond.
Whether we provide confidence through the products we recommend, the reassurance we offer during periods of uncertainty or the regular reviews that ensure you remain on track to your dreams, we’re on hand to help.
2. A sense of control
Financial confidence and education can also lead to a greater sense of control in the decades to come.
We can use cashflow modelling to help you understand the effect of the decisions you make (or might make further down the line).
Simple household budgeting techniques and protection, meanwhile, ensure that your loved ones are looked after now and in the future. This might be through the maintenance of a rainy day fund or protection plans like critical illness cover or life insurance.
3. Emotional wellbeing
Once you have confidence and a sense of control, peace of mind will follow.
You’ll feel better about your future – whatever that future brings. But not only that. You’ll also be able to live in the moment, enjoying your life circumstances now, knowing that you and your family are in safe hands.
Get in touch
If you would like help improving your financial literacy and you have loved ones that you think would benefit from working with us, get in touch. We can answer any questions you have about your retirement or long-term financial plans and investments.
Contact us now to find out how our Chartered financial planners could help you.
Please note
The value of your investment can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Levels, bases of and reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor.
