The Financial Conduct Authority (FCA) has published the results of its Financial Lives Survey 2017.
Financial Lives is the FCA’s largest tracking survey of consumers and their use of financial services, drawing on responses from just under 13,000 UK consumers aged 18 and over. The aim of the survey is to provide the FCA with unique insights into people’s experiences of retail financial products and services. The findings will help the FCA meet its objectives.
The survey collects information about the financial products consumers use and their attitudes to managing their money. It covers their experiences of using financial products and services, as well as their experiences of dealing with the firms that provide them. The report tells the financial story for six different age groups to show key themes at each life stage, from those 18-24 to those 65 and over.
50% of UK adults (25.6 million) display one or more characteristics that signal their potential vulnerability – they may be at increased risk of harm, or would suffer disproportionately if harm occurred. Potential vulnerability does not mean all people with these characteristics will suffer harm.
For all age groups the proportions showing characteristics of vulnerability are around the national average of 50%, except that for those 75 and over the proportions showing vulnerable characteristics are higher: 69% for the 75s and over, and 77% for the 85s and over.
The highest proportion (77%) of those with these characteristics are among the unbanked, and among the unemployed who are looking for work. Women account for the larger number of those with these characteristics, compared with men (46% or 11.7 million), as 53% of UK women (or 13.9 million) are potentially vulnerable.
Looking at the survey results from an age group perspective, the data reveal some interesting characteristics of UK consumers:
- Single parents aged 18-34 are 3 times as likely to use high-cost loans: 17% compared to the UK average of 6%
- We describe 13% of 25-34 year olds as being in difficulty, because they have missed paying domestic bills or meeting credit commitments in 3 or more of the last 6 months
- Just 35% of those aged 45-54 have given a great deal of thought as to how they will manage in retirement
- Those aged 65 and over are least likely to check if an internet site is secure before giving their bank or credit card details
The Financial Lives Survey 2017 is just one source of information on potential harm, seen from the point of view of the consumer. The survey results will contribute to understanding of harm, in support of the FCA’s ‘Mission’.
This publication is the second in a series of documents the FCA is publishing this autumn as part of its focus on consumers. It follows the publication of the ‘Ageing Population and Financial Services’ Occasional Paper last month. The FCA will publish an overarching strategy ‘Approach to Consumers’ later this year.
The FCA will also be releasing weighted data tables with the report so that other organisations will be able to use the survey findings for research purposes.
Andrew Bailey, FCA Chief Executive, said: “I would like to thank everyone who took part in the survey. The findings give us a wealth of information which will be used to increase our knowledge and understanding of the issues affecting consumers and how to best protect them. The data gathered will be invaluable in helping the FCA prioritise our work. We also hope that the research will provide valuable insight for other organisations focusing on consumers and finance.”
Commenting on the FCA Financial Lives Survey, David Haigh, Director of Financial Capability at the Money Advice Service said:
“Financial capability and vulnerability are complex, systemic issues that can’t be fixed by one organisation. The Financial Lives Survey is an important step forward in providing new insights into needs and pressures on UK consumers and where the regulator, the industry and third sector should focus their efforts.
We are excited to work with the FCA, industry and third sector partners to explore how these learnings can be put into action in services, products, guidance and advice that meet consumer needs at different life stages. Through the collaborative Financial Capability Strategy we are bringing partners together to improve financial capability in the UK, addressing all the factors that influence people’s behaviour around money: skills and knowledge, our attitudes towards money, motivation to take action, and the accessibility of products and services”.