How fortune favours the brave

However, there is good news on the horizon. In recent months, HM Treasury and the Financial Conduct Authority have been leading an exciting industry-wide review into how people could be better supported to make better financial decisions throughout life.

This review has the potential to revolutionise consumer finances by enabling the financial services industry to help people understand their options and make financial decisions with greater clarity, and confidence.

Moneybox surveyed 4,000 UK adults to learn more about how they are saving, investing, planning for retirement, and managing their day-to-day finances, so that we could understand how people could be better supported to achieve their goals and better financial outcomes.

One of the interesting things we observed was that income is not the only important factor when it comes to growing money and building wealth over time. Instead, financial confidence could be the real game changer as – regardless of income – those who consider themselves financially confident were found on average to have nearly double the net worth of those with lower levels of confidence.

When we look at the breakdown per city, our research shows that in Edinburgh over four in five (86 per cent) of those who feel financially confident, are more comfortable managing their personal finances than those who don’t feel financially confident, regardless of their income. In Glasgow, over half (54 per cent) who feel financially confident also said they felt more comfortable planning for their retirement.

Our research also revealed that more than six in ten Scots (62 per cent) believe they have missed out on financial opportunities in life with around a third citing this was due to a lack of financial knowledge (33 per cent) or low financial confidence specifically (30 per cent).

When it comes to investing, only one third of Scots reported they were either somewhat confident or very confident, with more than one in four (41 per cent) saying they are not at all confident on the topic.

This is no great surprise, considering most people have never received any formal financial education and so have been left to figure out how to manage their money and plan for the future through trial and error.

When we spoke to Scots about where they learnt how to manage their finances and plan for the future, a quarter (26 per cent) said they didn’t feel they had ever learnt how to manage their finances. Financial advice websites (29 per cent), parents (27 per cent), and  workplaces (17 per cent) were key places identified, with just 15 per cent having used a financial adviser.

While a valuable resource, financial advice regrettably remains a privilege for a select few, with only 13 per cent of Scots currently using an adviser for advice on their finances.

Without proper guidance, the financial decisions we make can lead to opportunities missed and mistakes made. What may seem like simple misdirections when we are young, can quickly snowball into significant challenges later in life.

The ability to make informed financial decisions should not be a luxury, but a fundamental right that must be extended to every person and not limited to those who can afford to pay for advice.

Currently, some financial services providers, like Moneybox, cannot offer financial advice and so are severely limited in how active a role they can play helping customers understand the financial options available to them.

And that is why the Advice Guidance Boundary Review (AGBR) I mentioned earlier, led by HM Treasury and the Financial Conduct Authority, could be revolutionary for consumer finances in Scotland.

The AGBR aims to review the parameters of financial advice and financial guidance, exploring where consumers could be better supported to make financial decisions with greater confidence. It would enable financial service providers, like Moneybox, to play a more active role in helping  customers understand their options by using data, prompts, and more tailored customer journeys to ensure better financial outcomes for customers.

“Targeted support” is one proposal within the AGBR that offers an exciting opportunity for industry-wide innovation, enabling financial services providers to support customers on their financial journeys with greater confidence –no matter the customers’ financial circumstances.

Democratising access to financial support in this way genuinely offers a once-in--a-generation opportunity to provide the support and education necessary to create a financially confident future for Scotland.

Brian Byrnes is head of personal finance at UK investment service Moneybox