Press release: Milestones become millstones for too many UK consumers

Wednesday 15 July 2015

A new report published today shows Britons could improve their ability to manage their money better if they planned ahead for major life events.

‘Milestones & Millstones’ from the Money Advice Service shows that although people do tend to plan for the good things in life, like buying a car or a home, many people don’t plan for the difficult or unexpected events in life, as they don’t believe, or don’t like to believe that those setbacks could happen to them.

The research shows more than three million people a year experience a negative event, such as a partner dying, ill health or redundancy, yet many consumers don’t act or ask for advice until it is too late.

The report highlights that buying a home or having children can get people into the longer term habit of budgeting and saving. But these positive events can also become financial millstones as consumers often don’t consider the full cost of the life event, or address the costs sufficiently well in advance. For example, parents-to-be only start financial planning after pregnancy and one-in-five first time buyers suffer financial difficulties as they deal with the ongoing costs of owning a home which end up being more than anticipated.

The research also looks at the problems for ‘Generation Rent’ and suggests many renters may lack confidence in their ability to reach financial goals such as saving a deposit. This means they might disengage from other financial activities, like saving for a pension.

Commenting on the launch of the report, Caroline Rookes, Chief Executive, Money Advice Service says:

“While no one likes to think about negative events impacting our lives, today’s research shows that people across the UK could improve their financial situations simply by planning ahead for events that are both expected and unexpected.

“It is quite concerning to see that those significant, planned life events that we all perceive to be positive, such as having a family or buying a home, can lead to financial hardship for millions across the UK.

“The research also really emphasises that that thinking realistically about the unexpected and planning for the future, can help us all achieve and enjoy life’s milestones.”

-ENDS-

For more information or to arrange an interview with a Money Advice Service spokesperson, please contact Pressoffice@moneyadviceservice.org.uk

NOTES TO EDITORS:

1: The Milestones and Millstones report can be found on our publications page.

About the Money Advice Service

The Money Advice Service is an independent organisation. It gives free, unbiased money advice online at moneyadviceservice.org.uk, over the phone on 0300 500 5000, and face-to-face right across the UK. The Service was set up by Government and is paid for by a statutory levy on the financial services industry, raised through the Financial Conduct Authority. Its statutory objectives are to enhance the understanding and knowledge of members of the public about financial matters (including the UK financial system); and to enhance the ability of members of the public to manage their own financial affairs.