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The prognosis for the national – and now the global – economy is looking dire, yet “Awful April” is just the latest blow to young adults who’ve been bearing the brunt of the cost-of-living crisis. Financially, emotionally, and mentally, young people have been squeezed on all sides and the long-term wellbeing of a generation will be disproportionately impacted by what kind of growth the retail sector chooses to pursue.
To put this in context, UM recently partnered with MoneySuperMarket and mental health charity CALM on a major piece of research, Money Talks: The Youth Tax, which focuses on the financial pressures facing 18–24-year-olds. The results do not make for easy reading: a quarter of young people are already in debt, and one in 10 of that group have had suicidal thoughts in the past year.
This isn’t an issue that can be brushed aside, or put down to profligacy: while around one-in-four admit to spending more than they can afford to emulate the lifestyles of influencers, more (43%) have used credit to pay essential bills. The stark fact is that this audience is more likely to use credit to buy food or pay rent than on luxuries or socialising.
As such, it’s time that retail brands think carefully about the role they play in normalising a credit-fuelled culture. Over 40% of young people have been targeted by ads promoting credit, such as Buy Now, Pay Later (BNPL), on social platforms and yet only a third feel brands are transparent about the risks that come with it.
Equally concerning are the unattainable lifestyles promoted on social media, over half (52%) of young adults feel under pressure to spend beyond their means just to fit in with what they see online.
The uncomfortable truth is that retail brands are – consciously or not – part of the problem.
The fact is retailers play a highly influential role in young people’s daily lives. While this is a position of privilege, it’s also one of responsibility. Given financial literacy isn’t uniformly compulsory across all schools. In England, and trust in traditional institutions is eroding, young people are looking elsewhere for guidance.
Nearly two-thirds (64%) of this audience believe brands have a role to play in helping them understand debt and credit, and a fifth would specifically welcome financial tips from retail brands. This isn’t an invitation to moralise. It’s a mandate to modernise.
Let’s be clear: young adults are not asking to be shielded from the realities of adult life. They’re asking for tools and transparency. There’s an opportunity here for responsible retail brands to help them make better financial decisions. This isn’t about slowing sales – it’s about building brand equity. The kind that lasts.
Authenticity is crucial. Financial literacy campaigns that feel like window dressing risk backfiring. But those that embed real value will stand out for the right reasons.
While aspirational social media and influencers were identified as putting pressure on young people, they can also play a part in the solution. The study found platforms like TikTok and Instagram are the second most popular places for young adults to learn about money (after friends and family). Many retail brands already have a strong presence on socials, so why not develop educational campaigns that reach young people’s feeds?
Myth-busting reels about the positives and the negatives in BNPL, short explainers on credit scores, or testimonials from peers sharing their budgeting journeys would all help to encourage healthy conversations around money.
By promoting responsible spending, rethinking how to communicate risk, and turning social channels into safe spaces for financial dialogue, retailers can redefine their role in young people’s lives. They can build campaigns that resonate through a more nuanced approach to distinctiveness, relevancy and value.
The cost-of-living crisis demands long-term thinking and financial literacy benefits all stakeholders. This isn’t just about doing the right thing – it’s about doing the smart thing. A customer who feels supported is more likely to become a repeat customer. As such, a brand that helps people understand money today is better positioned to retain their custom tomorrow.
The UK retail sector can only thrive by adapting to socio-economic change. As credit becomes further embedded in the way we shop, retailers must decide whether to keep pace with short-term gains, or lead the charge toward long-term trust.
