Businesses have a key role in helping apprentices understand pensions, as only one in ten young people correctly answer basic pension questions

• MaPS highlights a pension knowledge gap among young people in line with National Apprenticeship Week. 
• Only one in ten young people correctly answered four basic true / false pension questions correctly. Whilst one in eight don’t know their pension basics.   
• MaPS is encouraging businesses who offer apprenticeships to support their new apprentices to learn about pensions while training.   
• Visit MaPS’ guide on how businesses can help young apprentices with their financial wellbeing. 

It was rare that young people could demonstrate basic pension knowledge, as only one in ten (10%) answered all four correctly.

These figures contrast the knowledge that young people think they have, with half (50%) of young people said they understood the basics of pensions ‘very’ or ‘fairly’ well.

This research finds a big gap between what young people think they know and what they do really know.

MaPS is sharing this news in line with National Apprenticeship Week, which runs from 10-16 February, and this year is celebrating ‘Skills for Life’.

As part of this, MaPS is encouraging businesses who offer apprenticeships to encourage their young starters to learn about pensions and other key financial decisions, alongside their employment skills.

By offering pension skills alongside your employment skills, you are equipping young people with a good financial education and ensuring they start their careers on the right financial footing.

In doing so, businesses are demonstrating their commitment to employee wellbeing and development, making your business more attractive to future employees and apprentices.

To start supporting your apprentices with their pensions, visit MaPS’ guide on how businesses can build financial wellbeing in young employees and apprentices.

MaPS research has also shown that people who enjoy good financial wellbeing are more productive at work.

Understanding and contributing to a pension is part of overall financial wellbeing; by offering vital pension skills to your apprentices, this will help them to feel more financially secure, leading to higher productivity at work as well as increasing employee retention.

Learning about how pensions work, including benefits of employer contributions, tax relief, and how your money grows, is vital for young people as without this knowledge, they can’t make informed financial decisions that affect the rest of their lives.

Jackie Spencer, Head of Money and Pensions Policy at the Money and Pensions Service says:

“National Apprenticeship Week is the perfect time to remind young people becoming apprentices to consider their pension, and businesses have a part to play in this. For many, this could be the first time they are earning a wage, and they might not have had the opportunity to contribute to a pension before.

“Support your young apprentices by teaching them about how pensions work and explain that they can opt-in even if they don’t meet the criteria.

“In doing so, you’re putting your employee’s wellbeing at the forefront of your organisation, leading to an overall positive experience for your staff and increasing retention.

“The earlier young people understand and can contribute to their pensions the better, and we’d love to see businesses help them to get there.” 

Visit the National Apprenticeship WeekOpens in a new window website to learn more about how you can get involved.

– ENDS –

• This survey was conducted among a sample of 2,000 people aged 18-25 between 2 and 14 August 2024.   
• The data was weighted to be representative of the UK 18–25-year-old population. 
• Interviewing was conducted using a mixture of several online research panels.  This means the interview was a self-completion exercise making it easier for people to answer honestly about personal finances. 
• The four questions asked to gain an understanding of how well young people understand pensions are as follows: 

1. You’ll only receive tax relief on the pension contributions that you make.
   True / False / Not sure. 
2. Only your pension provider can choose how your pension contributions are invested.
   True / False / Not sure. 
3. You cannot move a pension pot from one pension provider to another.
   True / False / Not sure. 
4. You can start taking your money from your pension pot when you turn 55.
   True / False / Not sure 

Correct answers are: 

• Statement 1 – True 
• Statement 2 – False 
• Statement 3 – False 
• Statement 4 – True