Research published last week by Prudential shows most people under 25 are expecting a rosy holiday-filled retirement but IFAs believe many young people are naive and the lack of financial education in schools is the major reason.The study found that 65 per cent of under 25s are looking forward to spending time with their grandchildren when they retire, 63 per cent want to go on long holidays, 58 per cent hope to have the freedom to do what they want and 51 per cent are looking forward to living in their ideal home. Only 7 per cent worry about not having enough money. A lot of young people that the emphasis now very much on the individual to save for their future. Most under 25s do not have a basic financial education. Hargreaves Lansdown head of pensions research Tom McPhail says: “Financial education is regarded as an optional bolton rather than an essential life skill. We need to work hard to make sure that everyone coming out of school understands compound interest, debt, mortgages and investments.” Needanadviser.com director Ashley Clark agrees the system is deficient. He says: “A 16-year-old leaves school and cannot write a cheque but they know all about Pythagoras. My 10-year-old son has started to learn about money but it is too late for anyone who has already left school.” Clark believes Prudential’s research clearly displays the naivety of youth. He says: “They are looking at the future through rose-tinted glasses. The younger generation who have grown up playing with gadgets and going on overseas holidays do not have the financial awareness to be putting away for retirement.” But Informed Choice Ltd. director Martin Bamford believes that a lot of young people are savvy with their finances and says many of his younger clients have a pension, a mortgage and no personal debt. However, he adds: “It is polarised. Young people either take their finances very seriously or they do not give a damn, there is no in between.” Bamford says affordability is the main factor, with City professionals being the most likely segment to start planning for their retirement in their 20s. There are many other financial priorities for young people to consider, such as getting on the property ladder. But Origen head of annuities Nick Flynn says people have no chance of enjoying a relaxing retirement if they do not get into the housing market, so it makes sense for people to make that their priority. Winterthur Life pensions strategy manager Mike Morrison says people should not ignore paying into a pension fund because they own property. He says: “People are so geared up on getting into the housing market but they should not guarantee that their house is their pension.” Debt is another big hurdle for young people. Morrison says most people come out of university at least 10,000 in debt and few people can afford paying into a pension while carrying this debt. But Bamford says the upside to the record level of debt is that money is no longer a taboo subject, which is increasing financial awareness. Clark says: “It is a double-edged sword. The younger generation would rather be driving fast cars and the financial services industry is not interested in them because they have not built up any wealth yet. “We have made ourselves accessible to young people by having a huge interactive online presence.” Bamford, who has a large number of younger clients, believes that being in his 20s himself makes him more accessible. Morrison suggests a good starting point for any young person is to ask themselves how much money they will need to do the things they want to do and then work out from that how much money they will need to put away each year to get there andstart doing it.