Most young people believe investments and pensions are not relevant to their own financial position, and are instead aimed at "older people" according to research conducted by the FSA.
A study of 15-19 year-olds across the UK, commissioned by the FSA, suggests there are four main categories of young people when it comes to managing their own finances: conservative, hedonistic, mixed and aspirers (See table at the bottom of the story for more details of individual characteristics).
However, only 11% of those questioned said getting a pension was something they would eventually acquire.
At least 60% of those questioned by the NOP Research Group sessions said they hope to buy a home in the future while at least 20% hope to have no debts or to save regularly.
At the same time, there is currently little evidence to suggest they have any confidence in the financial services industry’s ability to help them manage their finances, as most said they turn to their parents for financial advice.
According to the report, entitled FSA research: Young people and financial matters, the role that money played in their lives depends largely in their lifestage and income.
15-16 year-olds, for example, said they primarily use money for socialising and creating, while some of the 18-19 year-olds who had started were starting to plan for the future and those in higher education considered the debt accumulated as a way of facilitating their future.
That said, financial matters are a subject very few young people showed interest in, according to the NOP research, except where money is being spent, and therefore only sough information when they really needed to.
Almost nine out of ten (88%) people questioned said their parents were the important influence on decision regarding money as financial advice is one of the few subjects they will turn to their parents for.
In contrast, young people said banks and building societies were a source of information, but used them infrequently because of the perceived hassle of using them.
Internet banking is still regarded as too risky by most young people, the report suggests as “scare stories” in the media have lead young consumers to believe internet banking carries a security risk.
Moreover, financial services advertising is perceived negatively by this category of the UK population, as adverts are perceived to encourage spending, to take advantage of people’s financial naivety and hide unpalatable terms of contracts.
Whereas financial education is rarely remembered as being taught at school, parents at least have managed to communicate some of the dangers of acquiring debt – particularly credit card debt – suggests the research as parents at these same research groups appeared to be "vociferous" on the matter, says the FSA.
|Group||Outlook||Main Influences||Attitudes to money and financial matters||Behaviour to money and financial matters|
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