Every pound spent on financial education initiates can create more than £5 in social value, a new study finds.
Research firm ERS examined the impact of “survival” money management workshops delivered to more than a thousand 16-25-year olds who were either not in work, full-time education or training, or had care responsibilities.
They found that every £1 spent on the programme created £5.57 in social value, and that this impact grew as time went on.
The impact was even greater outside of London, where the returns were as high as £8.19 per pound spent.
23 per cent more people were encouraged to save money regularly, and debts were 60 per cent lower than a group of peers who did not attend the workshops.
ERS estimates that it would cost £156m to deliver financial education to the 810,000 vulnerable young adults in the UK, but this would be outweighed nearly six times over by alleviating financial burdens.
The training, called Money Works, was delivered by charity MyBnk and funded by government-backed guidance body the Money Advice Service.
MyBnk’s own estimates of the programme argue that life satisfaction increases 28 per cent after the financial coaching, which covers topics such as budgeting and habits, the financial system, borrowing, how taxes, banking and benefits work, and accommodation.
MAS financial capability director Sarah Porretta says: “By providing care leavers with the awareness and confidence to seek advice, the programme has made strides in helping them with their transition to independent living. The findings from this programme will undoubtedly inform the practice and delivery of young people’s financial education.”