[INSIGHTS]: Financial Lives Survey 2022

External Links:

Summary

The Financial Conduct Authority (FCA) has released its Financial Lives 2022 report, providing insights into the financial well-being of UK consumers. This extensive survey covers a wide range of topics, including banking, debt, investments, and vulnerability. It sheds light on the impact of the COVID-19 pandemic on financial resilience and the continued digital transformation of financial services..

Find more at our training here

Vulnerability – UK Employee and Manager training for Collections

Key Points

Impact of the Pandemic: The report highlights the pandemic’s financial impact, with 35% of adults experiencing a decrease in income, while 29% saw an increase in their savings.
Digital Uptake: Digital banking and financial services continued to rise, with 71% of adults using online banking and 48% using mobile banking apps.
Savings and Investments: While 52% of adults have savings, only 23% hold investments. The report explores the reasons behind these disparities.
Debt Levels: Approximately 15% of adults are over-indebted, with high-cost credit and unsecured debts contributing to financial stress.
Vulnerability: Vulnerability drivers, such as health issues and negative life events, play a significant role in financial well-being.
Pension Engagement: A substantial portion of the population remains disengaged with their pensions, presenting challenges for retirement planning.
Cryptocurrency: About 7% of adults have invested in cryptocurrencies, highlighting the growing popularity of digital assets.
Ethnicity and Gender: The report delves into disparities in financial outcomes based on ethnicity and gender, identifying areas for improvement.
Green Finance: The survey explores environmental concerns and their influence on financial choices, indicating a rising interest in sustainable investments.
Open Banking: Open Banking initiatives are gaining traction, offering consumers new financial tools and services.
Payment Preferences: Cash usage continues to decline, with digital wallets and contactless payments becoming the norm.
Regulated Financial Advice: Only a small percentage of adults seek regulated financial advice, highlighting opportunities for improved financial planning.

Key Statistics

35% of adults experienced a decrease in income due to the pandemic.
71% of adults use online banking, while 48% use mobile banking apps.
15% of adults are over-indebted.
7% of adults have invested in cryptocurrencies.

Key Takeaways

The pandemic has had a profound impact on UK consumers’ finances, leading to income fluctuations and increased savings.
Digital banking and mobile apps are now mainstream, reshaping how people manage their finances.
Savings rates are higher than investment rates, emphasizing the need for investment education and access.
High-cost credit and unsecured debts contribute to financial stress for a significant portion of the population.
Vulnerability factors, including health issues and negative life events, are crucial considerations in financial planning.
Pension engagement remains a challenge, indicating the importance of financial education and awareness.
Cryptocurrency investments are on the rise, reflecting the growing interest in digital assets.
Addressing financial disparities based on ethnicity and gender is essential for achieving financial inclusion.
The environmental impact is influencing financial decisions, driving interest in green finance.
Open Banking offers opportunities for innovation in financial services.
Cash usage continues to decline as digital payment methods become more prevalent.
Encouraging regulated financial advice can help individuals make informed financial decisions.

RO-AR insider newsletter

Receive notifications of new RO-AR content notifications: Also subscribe here - unsubscribe anytime