Moneybox: How much does bad advice cost?

Of those surveyed (4,055), 29% of respondents learnt how to manage finances through their parents, while 11% relied on friends for advice. Given that family and friends may have also received a ‘hand-me-down’ financial education, Moneybox is concerned about the impact these decisions have had on the UK’s financial health and prospects.

Only 8% of the UK population opted to pay an adviser to assist with their financial planning. This will have resulted in higher net worth (approximately £68k more) than those that didn’t – regardless of income.

Furthermore, Moneybox’s research found that 16% of respondents struggle to understand personal finance jargon, while 17% find learning about personal finance overwhelming. This confusion has fuelled the ‘finfluencer’ trend, building online communities to help educate people about their finances.

“Financial education, both in school and in later life, has been severely lacking in the UK which means that most people have been left to figure out how to manage their money and plan for the future through trial and error,” said Brian Byrnes, Head of Personal Finance at Moneybox.

He believes the system is “far from ideal” and has contributed to persistently low levels of financial resilience amongst the UK population. This has fuelled social issues such as the gender pension gap and the ever-widening wealth gap.

Despite recent criticism of finfluencers with the Financial Conduct Authority (FCA) currently prosecuting several celebrity influencers for alleged financial promotion breaches, Brian feels that finfluencers “don’t get the credit they deserve for the role they have played in helping encourage more people to engage with learning about financial topics more regularly.”

“Now that regulation is catching up in this space, finfluencers and content creators across the industry will be better supported to guide their audiences with greater clarity,” he added.