The FSA has published its latest Consumer Research paper entitled The impact of life events on financial capability: Evidence from the BHPS.
The paper summarises an analysis of the impact of life events on financial capability. It focuses on the characteristics of individuals and the households in which they live that determine their ability to manage and take control of their finances (their 'financial capability').
Key findings include:
- Having a baby is associated with a reduction in financial capability and a 19 per cent increase in financial problems for an average individual, even when income is accounted for. The FSA’s Parent’s Guide to Money, distributed to all expectant parents, is targeted at a crucial point of need.
- Becoming unemployed decreases financial capability and increases financial problems by 63 per cent. If an individual receives Jobseeker's Allowance, financial problems are increased by 88 per cent.
- Divorcing or separating increases financial problems by 17 per cent on average.
View The impact of life events on financial capability: Evidence from the BHPS, 2 September 2009