£40,000 ($62,500) is, according to the UK Institute for Fiscal Studies, the average net British income for a household where two adults are working – (much higher than the average household).
A recent documentary on UK TV featured a set of households all living on this same net amount of money annually and examined how they choose to spend that money, deciding what they can and cannot afford. http://www.bbc.co.uk/iplayer/episode/b018grzr/Money_Forty_Grand/
Whilst all the participants were supposed to have the same net income, the lives, needs, values and attitudes to money of each of the participants were very different. Though size of mortgage and number of children were important factors, some contributors were struggling to get by, others feeling comparatively wealthy.
Given their similar net incomes, many banks would probably put many of these customers in the same segment, missing out on their very different needs. Some participants had elaborate means of staying in control of their money; others were barely in control at all. Yet few had a handle on balancing their long and short-term needs.
Are the financial institutions that these mass market consumers use giving them the understanding and control that they want? I believe that what consumers like these need from FS providers includes:
- Control – Allowing me to understand my current financial position and spending quickly and easily. Integrating online and offline worlds simply and seamlessly – across providers and outside.
- Convenience – allowing me to self-serve and access expert advice using channels of my choice
- Personalisation- Communicating with me as a human, making me feel you really understand me and my families’ current and future needs.
- Fairness & trustworthiness – Brands that I trust offering me great rates, reasonable charges (reflecting service costs) & rewards that I value.