£3.4bn cost of ‘financial illiteracy’

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A “DISGRACEFUL” lack of financial education is costing the UK about £3.4 billion a year, a report warned today.

The cost to the taxpayer of subsidising the retirement of people who have not saved enough for their later years could be slashed by a third if more were done to combat “financial illiteracy”, the study for MoneySavingExpert website said.

The report looked at how people armed with better financial skills would be more likely to plan their retirement effectively, boost their job prospects, steer clear of excessive debt and spend their cash more wisely.

The amounts of money lost through mis-selling scandals would be cut and £600million a year wiped off government subsidies to unemployed households, according to the research compiled by the Centre for Economics and Business Research.