Gen Z call for better money education as two in three report mental health toll over money worries

Financial pressures are weighing heavily on young adults as they navigate ‘real life’ finances like student loan repayments, rent, bills and understanding how credit works, according to new research. 

National charity Citizens Advice is working with Loqbox, a credit-building platform and financial wellbeing business, to highlight the important steps young people can take to improve their credit score – and, in turn, better manage their money.

A survey of 2,000 Gen Z UK adults found an alarming 65% said money worries are damaging their mental health, increasing stress and disrupting sleep. Almost two-thirds (64%) wish they had learned more about managing bills before moving out, evidencing a gap in basic financial education that is leaving many young people feeling unprepared – and can mean they face barriers when trying to access credit.

To spotlight this issue, Citizens Advice, which supported 53,000 under 25s last year alone, and Loqbox, are unveiling an installation at the Museum of Liverpool on Saturday, 18th April. The museum’s iconic staircase will transform into a one-day artwork called “Staircase to Adulting”, created in collaboration with artist Alicia Woolley. 

The installation will act as a visual representation of the real steps young people can take to improve their credit score like paying bills on time and registering to vote, as well as guidance on how to make these steps feel less stressful.

The financial education gap fuelling the stress of ‘financial firsts’

Managing money isn’t typically on the curriculum in schools, which can mean many young people are unprepared to take key financial steps. Each ‘first’, from receiving a first payslip or a first bill, can feel daunting.

Nearly 30% said making their first rent payment was their most stressful financial milestone, followed by paying their first household bill (24%) and receiving their first payslip (23%). Council Tax is a later shock, with stress rising from 11% for 18 to 20-year-olds to 26% for 27 to 28-year-olds as they take on greater household responsibilities.

Thomas Monaghan, from Citizens Advice, said: “If young people are beginning to manage their finances without the knowledge or support they need, it’s understandable they may feel stressed or lose sleep over money worries.

When money isn’t managed well, young people can find themselves facing barriers when trying to access credit, like a credit card or mortgage. That’s why we’re working with Loqbox to highlight the important steps they can take to improve their credit score, like fact-checking their own credit file and paying bills on time. 

Staircase to Adulting aims to highlight that it’s normal to find dealing with finances daunting at first, but there’s free, impartial advice available to help people take each step with confidence.”

The money myths blocking Gen Z’s progress

The research also highlights a series of common myths and misunderstandings about credit that can hold Gen Z back:

Over half (51%) of Gen Z believe that using Buy Now, Pay Later to spread the cost of a purchase does not affect their credit score, or are not sure whether it does

Only three in ten (31%) recognise that being on the electoral roll at their current address positively impacts their credit score, with a further third (31%) saying they are not sure

Over one in five (21%) falsely believe that getting a parking ticket or fine affects their credit score

Without clear information about how credit works, late-night worries can turn into real barriers. Over one in five Gen Zers (21%) have been declined for a credit card, and another 21% have been declined a personal loan because of their credit history or after a credit check. A limited or non-existent credit history can also leave people paying more for essentials like mobile phone contracts, or make it harder to access rental and housing options.

Tom Eyre, Co-founder and CEO at Loqbox, said: “These findings are a clear reminder that we give young people serious financial responsibilities long before we give them the tools to handle them. They are expected to sign contracts and manage debt while still trying to make sense of the small print. 

Working together with Citizens Advice, we want to make money management feel clearer and more human, so young adults can take small, confident steps that support their wellbeing and give them access to more choices in the future.”

Citizens Advice and Loqbox are working together to simplify financial education on money management and credit building – helping people understand how to improve their credit score without taking on debt, while making the most of their finances.

To find out more, visit www.citizensadvice.org.uk/staircase