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Over a third of people could have benefited from money advice when going through a divorce or separation

15 October 2015

Millions of people could have benefited from money advice at key times of their lives such as when they have a baby, buy a house, get divorced or fall ill in order to avoid financial problems in the future, finds a new report from Citizens Advice.

The national charity reveals almost half of the adult population (48 per cent) – over 23 million people – would have taken money advice at different key moments of their lives if they had been offered it.

In a new report Citizens Advice highlights the number of people who would accept money advice available at the key life stages they had been through:

●     More than a third (35 per cent) when they start working or change jobs.

●     Over 1 in 4 (28 per cent) when buying a home.

●     37 per cent when going through a divorce or separation.

●     More than 2 in 5 (44 per cent) when seriously ill.

●     38 per cent after a bereavement.

The Four Advice Gaps report finds that financial advice, support and guidance need to respond to the realities of people’s lives but currently there are multiple gaps. It broadens the debate around the advice gap by identifying four gaps where the help or guidance is not accessible or available for people to plan their finances.

One gap identified the ‘preventative advice gap’ whereby people would appreciate advice and help with their financial circumstances during big changes in their life but it isn’t presented to them.  For instance while two in five people (39 per cent) who have been in the situation said that they would have taken money advice when they were having a baby, only one in seven (14 per cent) were offered it.

The study looks at people’s experiences of money advice which includes everything from regulated independent financial advice to general money guidance, and draws on evidence from across the Citizens Advice service and a YouGov poll of 2,041 British adults.

Gillian Guy, Chief Executive of Citizens Advice said:

“Big life changes can have big financial consequences.

“Having a baby, moving jobs or losing a partner can have a huge impact on people’s finances. They may have to cover more costs, face higher bills or have to cope with a reduced income.

“As it stands too many people aren’t getting the money advice, support and guidance they need at key moments in their life such as when they buy a house or have a baby. Money advice can be vital to make sure people can make the right financial decisions now in order to avoid money problems in the future.

“The Financial Advice Market Review offers a real opportunity to ensure the money advice landscape is able to deliver this but to be successful the review needs to start and end with consumers’ needs. Price is part of the debate but so too is making sure consumers can easily move and be referred between different advice services, know the services that are available and can access them as and when they need them.”

The report identifies the three other advice gaps as:

Affordable advice gap: consumers who are willing to pay for money advice but not at current prices for the services on offer.  The new report suggests 5.4  million people would consider paying for money advice if it cost less.

Awareness and referral gap: people who are unaware money advice exists, the different services available or how to access it.  Over three million people said they needed free money advice in the last 2 years and failed to get it because they didn’t know it existed or where to find it.

Free advice gap: people who would benefit from money advice but are unable to pay for it.  Many households are not in the position to pay for advice with 49 per cent of households having a net financial wealth of less than £5,000.

Notes to editors

  1. Online YouGov survey of 2,041 adults carried out between 2nd - 5th October 2015. The figures have been weighted and are representative adult British population.

  2. Any scaling up calculated by Citizens Advice is based on figures for the Great Britain adult population of 48,358,351 taken from the 2011 census.

  3. 23 million figure based on 49% of respondents saying that for at least one of the ten key life moments listed they were not offered help but “would have taken up the offer of money advice” had they been offered it at the time.
  4. The Citizens Advice service comprises a network of local Citizens Advice, all of which are independent charities, the Citizens Advice consumer service and national charity Citizens Advice. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers. For more see the Citizens Advice website.
  5. The advice provided by the Citizens Advice service is free, independent, confidential, and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality.
  6. To get advice online or find your local bureau in England and Wales, visit citizensadvice.org.uk
  7. You can get consumer advice from the Citizens Advice consumer service on 03454 04 05 06 or 03454 04 05 05 for Welsh language speakers.
  8. Local Citizens Advice in England and Wales advised 2.5 million clients on 6.2 million problems in 2014/15. For full service statistics see our publication Advice trends.