Report: Half of U.K. Adults Living on Financial Brink

More than half of UK adults indicate that they are living “on the financial edge,” according to a blistering report into the overall financial capability of the country’s citizenry. The Money Advice Service (MAS), an independent entity established by the government to assist individuals and families with their financial education and wherewithal, noted that the results of its nationwide survey illustrate that approximately nine million more adults struggle with their personal financial lives, as compared to the number of such individuals in 2006.

Other findings of the MAS survey included that almost 20 percent of survey participants said they would spend money on entertainment they could not afford, while 17 percent made purchases beyond their financial means.  MAS attributes the sharp rise in financial illiteracy and capability largely to the nation’s economic downturn and more stringent household budgets, which hamper the desire and ability of UK citizens to save money for the future.

More than 5,000 individuals participated in the survey and, importantly, over 70 families were tracked for twelve months.  The report puts a spotlight on the general feeling among the nation’s populace that they need to “worry about their ability to make it to the next pay.”  Approximately 25 percent of those surveyed said that desire to live for today, rather than plan for the future.

The MAS was created initially to raise the levels of financial literacy and capability in the UK and is planning to disseminate a strategy designed to show people ways in which they can improve their finances.  This follows the UK government’s announcement earlier this year that financial education will be compulsory in secondary schools throughout the nation.  The MAS survey, as well as the UK government’s focus on raising the levels of financial literacy, are reflective of the overall rise in significance of financial literacy in both developed and developing countries throughout the world.