Let's be honest; not all of us are the sharpest tools in the box when it comes to handling our finances are we?

And quite a few of us need all the help we can get to get out of the money messes we find ourselves in; thankfully, there is some more help on the way!

That is because the Government today pledged £12 million for a large-scale trial of a free money guidance service.

The service will offer general advice on issues such as:

- Budgeting household spending - Saving and borrowing - Protecting and insuring the family - Planning retirement - Understanding tax and welfare benefits - Translating financial jargon

The service will be available online, via the telephone and face-to-face and the Government expects up to 750,000 people to use the service during the two-year trial, which is intended to establish how a national money guidance service could be delivered.

Details on how the scheme should operate were published today by Otto Thoresen, chief executive of financial services firm Aegon UK, in a report on generic financial advice in the UK.

Thoresen said a national "Money Guidance" service was needed to provide people with the knowledge, understanding and confidence to make better financial decisions.

Try the Money Hospital health check.

It is estimated that a national service would cost between £780 million and £1.67billion to set up and run between 2009 and 2060, and Mr. Thoresen said this should be split between the Government and the financial services industry.

His report claimed that by 2060 consumers could be more than £15 billion better off if they had access to financial guidance, as a result of better budgeting, debt management, shopping around and improved saving for retirement.

Launching his report, which was commissioned last year by the Treasury, Thoresen said he believed good money sense should be "as much part of people's lives in the 21st century as healthy eating and keeping fit".

He said research had shown 75% of people were interested in a national service for personal finance issues, with 25% saying they were very likely to use it.

He said the benefits to financial services companies would significantly outweigh the cost to the sector of paying for the scheme, because they would benefit from lower levels of bad debt, a better relationship with consumers and a reduction in advertising and selling costs.

The Government is also likely to benefit to the tune of between £4.65billion and £6billion by 2060 through reductions in the payment of Pension Credit and other benefits.

The service itself would be offered through partnership organisations which already help people with money issues, with the whole project overseen by the City watchdog the Financial Services Authority.

Announcing the funding for a pilot scheme, the Government said it wanted to ensure people had access to better help and advice when they needed it, to help stop them falling prey to loan sharks, doorstep lenders and unscrupulous sale and leaseback agents.

Announcing the funding, the chief secretary to the Treasury, Yvette Cooper, said the government already offered debt advice to those with serious financial problems, but there were many other people who could do with guidance. She said:

"It could be working out credit card repayments, budgeting for a new baby, or planning for retirement; people have to make serious financial decisions at every stage of their lives. "Getting some free, independent and trusted guidance can make all the difference and can help families manage their budget and get a better return on their savings.

"It could also help prevent people getting ripped off by loan sharks or caught out by the small print on a dodgy financial deal."

Peter Vicary-Smith, chief executive of consumer group Which?, said:

'We have been campaigning for over five years for a national service, which we believe is in the interests of consumers, industry and society. Otto Thoresen has, in his report, positively demonstrated the advantages of a money guidance service. The challenge is for Government, industry and consumer groups to make it work.'

The announcement was welcomed by the charity Citizens Advice, which has been running its own financial advice pilot, Moneyplan.

The charity's director of policy, Teresa Perchard, said:

"Moneyplan is showing that there is particular demand for a national service from people who are asset rich but cash poor, who need advice on dealing with pensions and who have queries about equity release and insurance. These decisions are complex and have potentially far reaching consequences for the people concerned."

She added:

"Introducing a national system to deliver such advice is extremely important for the financial prosperity of people of all ages, and the UK economy as a whole."

So, do you think the Government's idea is good one?

Will a free financial service make us all a bit wiser with our money?

Maybe we should also be teaching children about finance as part of the school curriculum?

Why not let us know in the comments below?

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