Evaluation Scotland Wales
The UK Strategy for Financial Wellbeing is taking forward the work of the Financial Capability Strategy Opens in a new window

Financial capability is the ability to manage money well – both day-to-day and through significant life events

What is financial capability?

Financial capability gives people the power and the confidence to make the most of their money and improve their lives.

Financial capability is the ability to manage money well – both day-to-day and through significant life events like having a baby, getting divorced or moving home.

Being financially capable means you have the resilience to handle times when life is financially difficult – like when you lose your job unexpectedly or you can’t work due to illness.

But financial capability is more than this. It’s also an attitude, that is more than just living for today – it’s having the confidence to put your money skills into practice, and understanding the value of doing so.

Behaviours of financially capable people

Being financially capable means:

  • Managing money well day-to-day
  • Planning and saving for the future
  • Preparing for the future and unexpected events
  • Using credit well but avoiding unmanageable debt.

A financially capable person:

  • Sees the value in actively managing their money
  • Knows how to make sound money decisions and act on them
  • Has confidence in their own ability to make decisions about money.

Why is financial capability important?

Financial capability – or the lack of it - has a profound effect on a person’s overall well-being.

But in the UK, far too many of us are struggling to manage our money well, with far-reaching consequences for us, our families and society.