The Money Advice Service says its 10-year strategy to improve UK consumers’ financial capability will succeed where similar initiatives have failed.
The MAS has today launched its Financial Capability Strategy which aims to improve consumers’ ability to manage money, save and deal with financial difficulties.
Last month Money Marketing revealed former FSA chief executive Sir Hector Sants had joined a Financial Capability Board to develop and maintain the strategy.
The MAS says the strategy will focus on “every key life stage and challenge”, including children, working age people, retirement planning, savings, older people and those in financial difficulties.
Planned initiatives include working with banks to explore how to target financial capability support at students showing signs of financial difficulty, and a study into which savings schemes work best for low income households.
The strategy also proposes piloting interventions with selected employers to help their employees see the need to plan and increase their retirement savings.
In addition, the MAS plans to support schools in delivering financial education.
The MAS says it will take on a role akin to a “what works centre”, seeking to build understanding of the effectiveness of interventions.
MAS chief executive Caroline Rookes says: “We realise the challenge and we want this strategy to be different.
“There are two characteristics of this strategy which we think will make the difference: it is based on collective impact and evidence-based interventions.
“We know a single organisation cannot do this on their own, so this has been put together with the help of numerous organisations and sectors. Further, instead of coming out with a set of recommendations, we want to test and learn from what works and spread best practice.”
She adds: “I am optimistic that those two things distinguish the strategy from what has gone before.
“In addition, there is a feeling among all sectors that the time has come to do something about financial capability because it has not improved.”
Rookes says the project will not require a significant reallocation of MAS’ resources, as it fits in with the organisation’s overall remit.
The strategy’s progress will be monitored by a regular financial capability survey and “ongoing evaluation” of specific interventions.
The results of the first survey, carried out among 5,000 people, found one in five adults cannot read a bank statement and four in 10 have less than £500 in savings.