Deciding whether to go to university or take an alternative career path is crucial for young people, who will have to weigh high debt levels versus an ultra-competitive market.
Millions of young people will get their A-level results this week, with decisions to make that will impact their financial futures.
Maike Currie, vice president of personal finance at PensionBee, said the results day used to dictate whether someone got the correct grades to go to university. Today, however, the choices are much broader.
“Prime minister Andy Burnham has said he wants vocational and technical education to be placed on a more equal footing with the traditional university route, reflecting a wider push to give young people more options after school,” she said.
The issue with university is the fees involved. Many graduates can leave university with around £50,000 of student debt and could make repayments for up to 40 years as interest rates make it difficult to pay off.
Under Plan 5 – which applies to students who started university from 2023 – repayments begin once earnings exceed £25,000, with 9% of earnings above this threshold paid back.
“For many students, university will remain the right choice. But the financial stakes have risen,” said Currie.
However, she added that the upfront costs are not the only thing to consider. Students should also look at likely earnings, living costs, qualifications, experience and future career prospects.
Apprenticeships are another option. They offer the chance to earn, gain experience and potentially avoid student debt. However, they are “fiercely competitive” and therefore can be difficult to get hold of, while a university can be the only route to certain jobs.
Taking time to make the right decision can be a good idea, but there is a difference between taking time to work out your next move and simply falling out of education and employment, she warned.
Data from the Office for National Statistics (ONS) found that more than 1 million young people aged 16 to 24 were not in education, employment or training in the first quarter of 2026.
This is at a time when AI is also reshaping entry-level work. While the nascent technology is creating new skills and jobs, it is also restricting opportunities in some areas.
Whether they go to university or enter employment, young people are less confident than previous generations that they will get a stable full-time job or be able to buy their own home, according to Ipsos research.
Currie said: “Gen Z has not stopped aspiring to financial security. Young people still want stable jobs, independence and homes of their own but in a fast-changing world with record youth unemployment, they are increasingly less confident they will achieve them.”
It is a bleak outlook for Gen Z, with data from St. James’s Place finding that younger generations are feeling financial pressures most intensely. More than half of 18- to 34-year-olds (54%) responded to the firm’s survey stating that their financial situation has negatively affected their mental health over the past year.
Building good finance practices early can help, said Currie, who suggested young people learn to budget before they enter the workforce or fly the nest and head to university.
“Financial education is part of the curriculum in secondary schools in England, but not all young people receive the same level of practical preparation for managing their own finances,” she said, suggesting that parents can help their children too by making money a normal part of family conversation.
“Before leaving home, young people should understand the basics: what is coming in, what is going out and where their money is going. For a student, that might mean managing a maintenance loan across a term, while for an apprentice it might mean making that first monthly salary last until payday,” she said.
This can include saving early. Parents can do this by saving into a junior ISA, which is handed over to a child at 16 and makes for a “good opportunity to explain what the money is invested in, why it was saved and the choices available from here”.
Options available include a stocks and shares ISA or a lifetime ISA, which the government plans to replace with a new first-time buyer ISA.
“We cannot remove every financial barrier facing this generation, but we can make sure they understand the choices in front of them and start adult life with the financial skills to make the most of whichever route they choose,” she concluded.