Request For Free Money Advice Service
Following a report on the 'Review of Generic Financial Advice', proposals have been put forward for a free national advice service to be set up offering consumers help with money related affairs.
Otto Thoresen, head of financial services firm AEGON, was asked by the Treasury to design a national money guidance service. In his report he suggested a £12m 2-year pilot project be launched offering consumers free telephone, internet and face-to-face advice regarding various financial matters. In addition, help would be at hand for any of the complicated jargon that normally comes with it. The estimated outlay for the trial project scheme is likely to cost £10m to £12m.
Thoresen suggested that the service would offer sales-free advice relating to significant life events which affect personal finance, such as starting employment, buying a property, starting a family, divorce and retirement.
He said, "I believe that good money sense needs to be as much part of people's lives in the 21st century as healthy eating and keeping fit."
Should the proposed service go ahead, it is estimated that consumers will benefit from savings of more than £15bn by 2060. The report predicted that the financial benefits to be gained from wiser saving and improved money management knowledge would far outweigh the initial launching costs faced by the government and financial sector.
It was proposed that funding for the project should come from both the government itself and levies from the financial services industry and is estimated to cost around £49m annually. The industry share would be raised from a levy which the Financial Services Authority (FSA) imposes on businesses it regulates in the credit industry and National Savings & Investments.
Published on March 5, 2008
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