Young care leavers are falling into debt because they aren’t receiving any financial education

A charity has claimed that those leaving care are falling into debt and financial difficulty due to insufficient guidance.

 
A report by the Children’s Society says that with no family to support them when they reach adulthood, they are being let down by local authorities and facing harsh benefit sanctions, pushing them into financial difficulty. 
 
The report highlighted that 57% of young people find it difficult managing their money and avoiding debt when leaving care.
 
Similarly to those starting university, problems arise when they are moved out of foster care or care homes into more independent accommodation. This is often their first experience of managing money, paying bills and budgeting. 
 
However this bracket of young people is particularly vulnerable as they have little to no support network. The survey described financial education, advice and support for care leavers across the country as “complex and inadequate” and stated that “the future life chances of a care leaver are dependent on which local authority they were in the care of and the abilities and capacity of their personal adviser”.
 
The report laid out a series of solutions, with financial education within a care leavers ‘pathway plan’ and debt advice a priority. Financial planning, budgeting and bill prioritising were mooted as essential skills for independent living. 
 
Further to this, the charity suggested that staggering the introduction of bills such as council tax over time would allow care leavers to acclimatise to their new responsibilities. 
 
Creditors should record care leavers as vulnerable clients, provide them with the appropriate support and access to mainstream financial products such as bank accounts, it was suggested. 
 

If you have recently left care and are struggling to understand your budget or have gotten into debt, call our helpline for free and confidential advice.