A plan to provide UK adults with free financial advice could be nearing reality after initial research has found that it would be both a cost effective and beneficial way to help equip millions of Brits with sound financial advice that could keep them out of debt.
According to the report, which outlines the feasibility of the scheme and possible funds required to run it, the benefits would outweigh the costs by 3.5 to 1 making it worthy of being turned into a national service and rolled out across the whole of the UK.
Currently there are several pilot schemes taking place in North West England, London and South Staffordshire. Findings from these will be collated in the New Year and presented to the Government before a final decision is made.
So far it is estimated that the annual running costs could be in the region of between £40m to £80m. It has been suggested that the funds would be provided by the Government and the financial services industry, although there is expected to be an ongoing debate in order to thrash out the finer details.
Chief Executive of Aegon UK, Otto Thoresen who has compiled the review comments: "The research and evidence we have gathered so far has enabled us to define in broad terms some of the principles for a national system of generic financial advice.
“Complete impartiality and effective marketing will be critical. But it's also essential to design a system which will be of genuine benefit to people and which can be sustained over the longer term. We are currently running pilot schemes to test out elements of a national system and the findings will enable us to develop the proposals further in the months ahead.”
Based on consumer research, the report sets out key principles for delivering a national ‘GFA’ service and includes offering a range of information and guidance, from ‘jargon busting’ and managing debt to budgeting and avoiding being mis-sold financial products as well as guiding participants thorough the complexities of the tax and benefits system.
The scheme, which has been backed by consumer organisation ‘Which?’ will be made available to anyone requiring advice on how best to manage their finances. The final dates for implementation are yet to be decided.Debt advice
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