Money Wellness
A homeless teenage girl
category iconcost of living
calendar icon25 Oct 2023

National Care Leavers’ Week – the scandal of Britain’s unseen teenagers

Amanda Bennett is one of our debt advisers. Growing up, her best friend lived in various foster homes. After witnessing firsthand the struggles children in care face, Amanda has gone on to volunteer as an independent visitor with the National Youth Advocacy Service (NYAS).

She explained this involves getting matched up with a young person living in foster care or a children’s home. You commit to spending an hour a month for a minimum of two years with that youngster.

Whereas social workers may come and go and foster homes may change, you’re there to act as a regular, constant presence in that young person’s life. You’re someone without an agenda who chooses to be there rather than being there because it’s your job or there’s a family expectation to be involved. Amanda has taken the young person she’s been matched with to the cinema, pottery painting, ice staking, out for meals, bowling and to the park.

Life can be hard for children in care but what about when they turn 18 and have to leave their foster placement or children’s home?

The financial struggles faced by care leavers

Managing money can be tough when you leave care for a variety of reasons:

  • Financially independent at a young age – Youngsters brought up in care are left to fend for themselves from the age of 18. Some youngsters leave care even earlier than this due to turbulent foster placements etc. In comparison, a typical young people who hasn’t lived in care stays in the family home until the age of 24.
  • Lack of support – Care leavers don’t usually have the same level of support as other people their age. This means they have fewer people to turn to for help with money problems.
  • Digital exclusion – Catch 22 – a network of charities calling for better care-leaving services – points to examples of care leavers being forced to choose between paying for food and Wi-Fi access. It warns digital poverty is affecting youngsters’ chances of getting work or continuing their education.
  • Mental illness – According to Catch 22, nearly half of children in care suffer with psychiatric disorders compared to one in ten children generally. The link between poor mental health and debt is well documented – with some mental health conditions making it harder to earn and manage money, and money worries having a devastating effect on mental wellbeing.
  • Low rate of universal credit for under 25s – Despite having to manage household bills from the age of 18, care leavers who are aged under 25 have to manage on lower universal credit support than those aged 25 and above - £292.11 a month, compared to £368.74 a month.

Luck of the draw

Amanda explained a lack of financial education exacerbates these problems.

She said:

“Managing your money [and] budgeting isn’t taught in schools. It should be but it’s not… So you’re very much reliant on what you learn at home and what you pick up through life. And if you’ve grown up in foster care and you’ve moved from placement to placement [or]… you’ve grown up in children’s homes, it’s luck of the draw whether you get those lessons.”

I didn’t understand

When we asked Amanda about the kind of issues she was encountering among care leavers ringing Money Wellness for advice, she explained:

“The general conversation you get is ‘I didn’t know what I was signing up for. I didn’t understand when I got all these offers through for credit cards and loans and payday loans and things like that. I had absolutely no idea. I didn’t understand the terms and conditions. I didn’t understand what I was signing up for. When they told me they’d lend me 200 quid but I had to pay back 400 quid, I didn’t realise that that was not a good deal. I just thought it was a good way of getting 200 quid and I didn’t think about the consequences because I didn’t understand’.”

I didn’t know you had to pay for water

Amanda recalled one particular conversation she had with a care leaver about bills:

“One person I spoke to was like ‘I didn’t know you had to pay for your water’…because you don’t, especially if you’ve grown up in a children’s home. You’re not growing up in a family where you see the bills coming in… You don’t have experience of that. You don’t go shopping with your parents and see how much a basketful of shopping costs. You don’t have those same experiences that you have when you grow up in a more stable family environment.”

Council tax shock

Care leavers are exempt from paying council tax until they’re 25. However, Amanda explained, a lack of awareness can mean care leavers are in for a shock when that exemption ends:

“I’ve spoken to people who are over 25 who had to start paying council tax and just totally weren’t prepared for it because they’ve not had to pay it as a care leaver. So then it’s an expense that just kind of gets dropped on you and it’s like ‘now you need to start paying council tax on top of all this’.”

Care leavers and homelessness

The statistics surrounding care leavers and homelessness strongly suggest the support being offered to youngsters leaving foster placements and children’s homes is woefully inadequate.

Figures from NYAS show:

  • 33% of care leavers become homeless in the first two years after leaving a children’s home or foster care
  • 25% of all single homeless people have been in care

As shocking as these statistics are, they don’t reflect the full extent of the problem. This is because many young care leavers are among the hidden homeless – sofa surfing, sleeping in squats and staying in abusive relationships because they have nowhere else to go.

Call for action

We’re calling for better financial education in schools so that all children, regardless of their homelife, are taught how to budget and manage their money.

We’re also backing calls for ‘having-lived-in-care’ to be made a protected characteristic. This would ensure people who have lived with foster families or in children’s homes get lifelong protection from discrimination. It would also force public bodies and other organisation to bear care-experienced people in mind when making policy decisions.

Ian Somerset, chief executive at Money Wellness, said:

“The number of care leavers ending up sleeping on the streets is an absolute scandal. Clearly the current system isn’t working. Making ‘having-lived-in-care’ a protected characteristic would provide care leavers with lifelong protection from discrimination, and ensure their needs are taken into account by organisations as a matter of course.

“It’s also vital that we start teaching schoolkids how to manage money. These are skills that can have a profound effect on a person’s quality of life and, for care leavers in particular, they could be a game changer.”

Avatar of Rebecca Routledge

Rebecca Routledge

A qualified journalist for over 15 years with a background in financial services. Rebecca is Money Wellness’s consumer champion, helping you improve your financial wellbeing by providing information on everything from income maximisation to budgeting and saving tips.

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