insight
Evidence type: Insight i
Qualitative research is more exploratory, and uses a range of methods like interviews, focus groups and observation to gain a deeper understanding about specific issues - such as people’s experiences, behaviours and attitudes.
Quantitative research uses statistical or numerical analysis of survey data to answer questions about how much, how many, how often or to what extent particular characteristics are seen in a population. It is often used to look at changes over time and can identify relationships between characteristics like people’s attitudes and behaviours.
It is of growing importance that individuals are able to collect and assess information in order to make informed financial decision. Consequences of poor financial decisions can be devastating. For example, 2.6 million people in the UK suffer from severe debt problems. Moreover, 12 million adults aren’t saving enough for their retirement. Financial situations like these can have a negative impact on both a families’ immediate and longer term living standards and even have a negative impact on wellbeing.
Beyond the individual impact of having good financial capability, the ability to make informed and effective decisions drives competition in financial markets and incentivises companies to provide better goods for lower prices, improve productivity and boost economic growth.
This report provides an original analysis of the third wave of the Wealth and Assets Survey (2010-12), undertaken by the Office for National Statistics, for five key components of financial capability using a household perspective. The key components are:
It seeks to shed new light on the nature of the financial capability problem in Great Britain and discusses what actions can be taken to improve capability and outcomes for families.
This is a secondary analysis of the Wealth and Assets Survey (2010-2012), in which 30,000 individuals aged 18+ were surveyed in Great Britain.
The results of a nationally representative poll of 2007 UK adults and a focus group held in December 2015 are also used to support findings in this report; however, no information has been provided as to the size or scope of the representative poll or the focus group.
While this report does not explicitly set out research questions, by using the household nature of the survey it assesses how families share responsibilities and asks whether social ties can reduce the impact of individuals’ low financial capability. Findings are grouped under two sections:
Financial capability in Great Britain:
Family ties for mitigating poor financial capability:
Recommendations:
The report recommends that a household approach to improving financial capability needs to be taken. The report provides a number of detailed recommendations based on the type of household the government wishes to target, i.e. capability poor, mixed capability or capability rich households.
As an overview, the recommendations included:
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