Financial education of vulnerable young people

1. Context
2. The study
3. Key findings
4. Points to consider

Context

In order for them to succeed in life, young people must have the necessary skills, attitudes and knowledge, including in relation to effective money management. For vulnerable young people this must come early in life as they are often expected to live independently from a young age and must also extend beyond making ends meet. This study explored the existing landscape of provision for financial education for vulnerable young people, their needs and how these might be more effectively met. The definition of vulnerable young people was not initially prescriptive, but was later narrowed to focus exclusively on youth homelessness, ‘Looked After’ children and care leavers, and young people not in employment education or training.

The study

The report describes the results of an inquiry by the All-party Parliamentary Group (APPG) on Financial Education for Young People into the best way to meet the needs of vulnerable people aged under 25. The study involved: a call for evidence (with responses from 36 organisations; 13 from the third sector; 12 in Education and Youth services; 10 from the financial Services sector; and one from BIS), hearings (with 14 organisations); and a consultation with young people with experience of homelessness. It investigated: existing financial education provision; the effectiveness of corporate and charitable engagement with financial education programmes; effective models for reaching potentially financial excluded vulnerable young people; how organisations might be encouraged to include financial education in their programmes; and the role of financial education in financial and social inclusion. The study was undertaken with the support of Lloyds Banking Group.

Key findings

The key findings of the inquiry were:

• The importance of financial capability to prepare young people for independent living early was widely recognised by organisations and young people alike, but most young people do not know where to find help or support. The report states that the main challenge lies in reaching young people.
• There is only patchy and largely uncoordinated provision of effective financial capability programmes aimed at vulnerably young people, although there are many innovative and effective examples which represent good practice. There are numerous resources available for financial education/training, albeit mainly focused on schools.
• Practitioners working with vulnerable young people must themselves have the skills and confidence needed to tackle money-related issues.
• Provision must be underpinned by principles and there is much greater need for greater coordination at the local and national level.

The report makes a series of key recommendations for public bodies, charities and financial institutions and suggests more work is needed to identify how to support parents and families more effectively. This includes equipping organisation staff to signpost existing services, embed financial capability within policies, practice and procedures, promote partnership working and develop coordinated national policies and local strategies for developing young people’s financial capability. The biggest challenge lies in reaching vulnerable young people.

Points to consider

• Methodological strengths or limitations: The evidence is comprehensive but largely collaborative and anecdotal rather than being based on replicable methods of social research. The report is mainly a review of this primary evidence and a set of recommendations.

Full report

Financial education of vulnerable young people - full report