Research shines light on experience of financial uncertainty among UK households
New research by the Centre for Personal Financial Wellbeing at Aston University will shine a light on the real day-to-day experience of financial uncertainty among UK households and help inform policy and market innovation and debate.
The Real Accounts project will build an in-depth understanding of the lived experience of financial uncertainty among low to moderate income households across the country.
Believed to be the first of its kind in the UK and in contrast with the snapshot data achieved by annual surveys, this long-term study will provide a fully joined-up view of household finances, capturing the day-to-day, week-to-week ups and downs, working with households to understand the situations they face and the strategies they use to manage their money.
The project will be a collaboration with Nest Insight and the Yunus Centre for Social Business and Health at Glasgow Caledonian University.
Experts will use a research data collection app that has been custom designed by Moneyhub to capture real-time income and expenditure transaction data over six months for a sample of around 50 low to moderate income households, combined with monthly interviewing.
Professor Andy Lymer, director of the Centre for Personal Financial Wellbeing at Aston University, said: “We are really pleased to be part of this innovative project, directly focusing on real experiences of managing financial volatility and the impact that has on broader aspects of wellbeing.
“Too little is currently known about the scope and scale of income and expense volatility experienced by UK households.
“This research is really timely given people are currently facing the very significant impact of the cost-of-living crisis and often enormous uncertainty about both their incomes and their expenditures.
“The outcomes of this work will generate deeper understanding of what it means to experience financial challenges in reality and over sustained periods of time.
“It will contribute to finding better ways to help people in their everyday lives and is a perfect fit for the focus of our Centre that seeks to deepen our understanding of what matters in creating personal financial wellbeing. ”
Sope Otulana, head of research at Nest Insight, said: “As the rising cost of living continues to impact households across the country, and levels of household debt climb, this research is more crucial than ever.
“The project aims to shine a light on exactly what it is like for households today managing volatile income and expenditure, sharing their first-hand stories.
“While large income and expenditure datasets track individuals and their behaviour out in the world, this research puts individuals back into the contexts where their financial lives play out, focussing on the overall household - partners, parents, siblings, friends and other social connections.
“It will look beyond the balance sheet to also analyse social, environmental, and health factors, as well as other dynamics that can come into play and affect household finances. The research will identify trends but also capture the variation within households, recognising that there is no 'average ' household circumstance or experience. ”
You can find out more about the project here.