On the effects of receiving encouragement to seek help, our pilot evidence suggests informal help, such as from friends and family, does not tackle the root causes of an individual’s debt. This is despite respondents reporting a greater feeling of wellbeing. There is clearly a sense of relief, even though effective strategies to tackle debt are not adopted.
This is of particular interest for policymakers and service designers to prevent people from taking a less optimal route to solve their debt problem when formal debt advice is available.
As the encouragement did not significantly increase the probability of seeking formal debt advice, we cannot use the randomised encouragement design to assess the effects of receiving formal advice. However, we can still use our PLS to compare the outcomes at the second wave.
Descriptive evidence on the role of formal debt advice suggests people who seek it tend to be facing the greatest level of financial difficulty, with formal advice likely to mitigate and possibly counteract these difficulties.
Further learnings and recommendations on ways to improve the longitudinal study and enhance effectiveness are included in the reports below.