Talking about financial education is not sexy. It fails to grab the attention of many people, despite the efforts of several high-profile campaigns by charities, businesses and journalists. But it is undeniably one of the fundamental challenges for the financial services sector and shouldn’t be skipped over.
In the current economic environment, millions of people have been forced into unemployment and financial insecurity. At the same time, a baffling array of financial products, complex retirement plans and even some unscrupulous scammers are leaving those who are financially vulnerable exposed to potential exploitation and debt. So, let’s look at some hard facts:
The current level of personal debt in the UK is high. The average total debt per household is £65,513, whilst the total debt is £1,839.7 billion, and this is up by £58 billion from the previous year. This is a significant burden for many households, and it can lead to financial problems if not managed properly. There is also evidence that major UK banks are tightening their lending standards, which makes it harder for people to get loans if they are judged to be at higher risk of default.
This comes at a time when many financial services providers are overlooking the benefits financial education could bring to their customers in response to this escalating situation. Financial literacy has been proven to increase social mobility and improve financial behaviour for individuals and communities. But are brands in the sector doing enough to challenge the status quo?
Some are playing their part, and this is commendable, but there are plenty of ways others could step up:
- Partner with schools and community organizations. UK brands can partner with schools and community organizations to provide financial education programs to students and families. This could involve providing financial literacy resources, hosting workshops, or offering scholarships.
- Advocate for financial education policies. UK brands can advocate for financial education policies at the local, regional, and national levels. This could involve working with policymakers to develop and implement financial education programs, or to provide financial education resources to schools and community organizations.
- Create and share financial education content. UK brands can create and share financial education content through their websites, social media channels, and other marketing materials. This content could cover a variety of topics, such as budgeting, saving, investing, and credit.
- Sponsor financial education events. UK brands can sponsor financial education events, such as conferences, workshops, and fairs. This helps to raise awareness of financial education and provides an opportunity for people to learn more about financial topics.
Much of this may seem intuitive. But the challenge with these types of programmes is to bring creativity and commitment that will deliver true benefits for those who are often overlooked by the mainstream finance sector.
It also doesn’t have to be only those with an altruistic approach who get involved. Brands that do support financial education can often see increased customer loyalty because people like to do business with brands that they feel are committed to their financial well-being.
Working with personal finance influencers can also be a highly effective way to promote programmes around financial literacy and there plenty out there who have the right audiences and platforms which brands can look to work with:
- If appealing to an audience that prefers TikTok, then influencers like Gabriel Nussbaum can offer great partnership opportunities,
- Or if you are looking for a content creator on technical yet engaging videos on YouTube then Mark Tilbury
- Or traditional champions who are regularly on broadcast and in the national media opportunities like Iona Bain
In the UK, the main political parties are already looking for ideas for their next election manifestos. So if brands have suggestions or calls to action, now is the time to make your views heard.
Should there be the introduction of a national financial education programme? How could banks and other financial institutions work with the government and regulators to make financial services more affordable? How could access to financial services be expanded to areas with geographical and social limitations? Taking a real, policy-based view on these issues is what elevates run-of-the-mill campaigns to genuine thought leadership.
Not everyone is going to agree with your suggestion. But sparking a debate on financial education and inclusion whilst showing how you are making your commitment to improving the situation can deliver real benefits at a time when many are needing help.