Survey finds 56% of young adults are clueless about ISAs

From ISAs and investments to pension planning, young adults in the UK are struggling with understanding their finances. In fact, new research shows that Gen Z are the least financially literate and confident generation, highlighting an urgent need for better money education and practical guidance.

In a nationwide survey of 2,000 UK adults, Shepherds Friendly tested knowledge of ISAs, investing, insurance, income protection and general personal finance, revealing a financial literacy crisis in the UK, with many Brits struggling to understand essential money concepts.

Key findings from the research:

Only 9% of 18-24-year-olds passed Shepherds Friendly’s money literacy test, making them the least financially literate generation. Gen Z is also the least financially confident generation, with over half struggling with pension planning (50%) , ISAs (55%), and retirement planning (56%).
Nearly 50% of 18-24 year olds say their finances have had a negative impact on their mental health, while 44.29% say trying to understand their finances makes them feel stressed, and nearly 40% admit to losing sleep over their finances.
Nearly 60% of young adults believe personal finance should be taught more in schools. 59.52% say schools should teach young people how to save and invest, and 41.90% say their financial struggles stem from a lack of financial education.

Derence Lee, Chief Finance Officer at Shepherds Friendly, believes that without improved access to financial education and advice, many people risk falling further behind in their financial wellbeing. Derence says:

“Our survey showed that many people feel unsure about different areas of personal finance, from investing to insurance. But understanding key financial topics and the products that can help plan for the future is essential for feeling confident when making decisions about your money. Improving financial literacy can benefit everyone, whether you’re just starting out or already thinking about retirement.

“There’s plenty you can do to build your money skills. Even small steps, like exploring online learning tools, using budgeting apps, or reading trusted resources, can make a real difference. For those who feel unsure where to start, speaking to a qualified financial adviser can help turn confusion into clarity”

More information can be found in the press release below, or the full survey can be found here: https://www.shepherdsfriendly.co.uk/resources/money-literacy-2025/

Less than one in 10 young people passed this financial literacy test

New research from Shepherds Friendly reveals that financial literacy levels in the UK have fallen compared to previous years, with fewer than one in four Brits able to pass their money literacy test.

Just 23% of Brits passed Shepherds Friendly’s money literacy quiz, down from 49% in 2024.
Men were more likely to pass than women (29% vs 17%), while only 9% of 18- 24 year olds achieved a passing score.
Self confidence in finance topics revealed to be low, with investing, ISA saving and pension planning being the top three areas of struggle.
Young people are the least confident overall, with over half of 18-24 year olds not feeling confident with things like pension planning and choosing the right ISA.

As financial literacy becomes increasingly crucial in navigating modern life, a staggering 70% of Brits believe that financial education should be a mandatory part of the school curriculum.

To find out more about the state of Britain’s financial literacy, Shepherds Friendly has conducted a survey of 2,000 Brits on their knowledge of ISAs, investing, insurance, income protection and general personal finance. The results reveal significant insights into the nation’s understanding of essential financial concepts.

You can read the full research here: https://www.shepherdsfriendly.co.uk/resources/money-literacy-2025/

Fewer than one in four Brits passed Shepherds Friendly’s money literacy test

With just 23% of those surveyed passing the test, this indicates that there are substantial gaps in Britain’s financial literacy. Shepherds Friendly also conducted a money literacy test in 2024 which 49% of people passed, and in 2023 which saw a pass rate of 27%, suggesting that financial understanding has slipped.

In the most recent test, men were more likely to pass than women (29% vs 17%), while younger adults are struggling the most, with only 9% of 18-24 year olds achieving a passing score compared to 34% of those aged 55 and over.

Nottingham was revealed to have the highest pass overall pass rate at 33%, followed by Bristol (30%) and Brighton (29%). Meanwhile, Leeds had the lowest pass rate at just 15%.

The 10 Cities with the Highest ‘Financial Literacy’ Pass Rates			The 10 Cities with the Lowest ‘Financial Literacy’ Pass Rates
Rank	City	Pass rate	Rank	City	Pass rate
1	Nottingham	33.0%	1	Leeds	15.4%
2	Bristol	30.4%	2	Belfast	15.5%
3	Brighton	28.1%	3	Cardiff	15.6%
4	Southampton	28.0%	4	Manchester	19.8%
5	Sheffield	26.1%	5	Newcastle	20.3%

Young people face the biggest knowledge and confidence gaps

Confidence is also low across key financial topics. Nearly half (48%) of Brits said they don’t feel confident investing, 43% aren’t sure which ISA suits their goals, and 39% lack confidence with pension planning.

However, younger generations were consistently found to have the lowest levels of both understanding and confidence across almost every financial topic. Over half (56%) of 18-24 year olds said they don’t understand pension planning, while 55% said they aren’t confident in choosing the right ISA.

This lack of financial confidence appears to be having wider effects on well-being. Nearly 50% of 18-24-year-olds say their finances have had a negative impact on their mental health, while 44% say trying to understand their finances makes them feel stressed, and nearly 40% admit to losing sleep over their finances.
The findings suggest that the absence of financial education earlier in life is leaving younger adults ill-equipped to manage their money and plan for the future.

Brits call for personal finance to be taught in schools

Seven in ten Brits (70%) believe personal finance should be part of the school curriculum, with 72% saying lessons should focus on practical skills such as how to save and invest.

A lack of financial understanding may also be preventing people from preparing for emergencies or achieving their long-term goals. Around half (54%) of Brits said they regularly review their financial progress, while just three in 10 (34%) feel confident they’ll reach their financial goals.

Experts warn that without improved access to financial education and advice, many people risk falling further behind in their financial wellbeing.

Derence Lee, Chief Finance Officer, at Shepherds Friendly says:

“There’s also a responsibility on providers of financial products to make their offerings easy to understand. At Shepherds Friendly, we aim to be a jargon-free zone, helping people learn about our products and personal finance topics so they can make informed choices. By improving financial knowledge, we can all make smarter decisions, feel more confident, and build a stronger financial future for ourselves and our families.”

Methodology:

Findings based on a survey of 2,001 Brits aged 18+ conducted between 03/09/2025 and 08/09/2025.

The pass rate of the quiz was calculated by finding the percentage of respondents who got half or more of the quiz questions on ISAs, investing, income protection, insurance and personal finance correct.
Please note that year-on-year comparisons of the Money Literacy Quiz pass rate have been made in this blog post (from 2023, 2024 and 2025), however the quiz questions are not identical year-on-year. The aim is to measure overall financial literacy rather than exact question-level comparability.

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Survey finds 56% of young adults are clueless about ISAs