Financial capability can be defined as the ability to manage money well – both day-to-day and through significant life events. Critically, financial capability is a crucial component of people's financial wellbeing - their ability to meet all current commitments, without undue stress, and the resilience to cope with future income or expenditure shocks.

The Money and Pensions Service's recent survey of 5,974 adults across the UK produced some alarming insights to the nation's knowledge and confidence with money matters.  I will summarise key findings of the report here:

Financial education: 

Only 52% of 7-17 year olds say they receive a meaningful financial education in school, at home or in other settings.

Day to day: 

21% rarely or never save and of the 79% that do 22% have less than £100 in savings and investments. Whilst 17% of participants regularly had to use a credit card, overdraft or borrow money to buy food or pay bills.

Debt: 

17% are over-indebted yet only around a third receive help.

Confidence: 

47% do not feel confident making decisions about financial products and services. Whilst 27% of working age adults are over-confident in their ability to use numbers in everyday life.

Sense of control: 

63% of participants do not feel they can determine what happens in their lives when it comes to money, and 61% do not focus on the long term when it comes to money.

Planning ahead: 

49% could last 3 months or more without borrowing if they lose their main source of income. Only 53% have a plan for financial goals for the next five years. 43% of adults aged 65+ are not engaged with how they would manage financially if they needed to go into long-term residential care. 55% of working-age adults do not feel that they understand enough about pensions to make decisions about saving for retirement.

Getting support: 

For 59% of life events, working-age adults did not seek financial help or support. 38% of adults age 65+ have used the internet for online or mobile banking, whilst 58% know of organisations or websites offering free or affordable financial information, help or support.

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