22nd May 2015 at 3:19pm
Britain’s 18-24 year olds are more dedicated to short-term saving than those aged 55 and above, according to a recent survey*.
Our research found that 15% of Britons aged between 18 and 24 put money aside for the following month, compared to just 5% of those aged 55 and over.
Many of the respondents in the 18-24 year old age group are likely to be either full or part-time students or at the early stages of their working career. Compared to those aged 55 and over, they are
less likely to find themselves on a solid financial footing – which may partly explain their approach to short-term saving. The survey results revealed one in ten 18-24 year olds save money from one week to the next, whilst the same number also put money aside for the next three months.
14% base their savings on their needs for the next six months, compared to just 3% of those in the 55-plus age bracket. Only 5% of the older generation save for the following month, whilst just 1% feel the need to put money away for the next three months.
The short-term saving habits of 18-24 year olds also extend into the 25-34 age bracket, with just over one in ten (12%) revealing they save on a week by week basis. This then drops to 4% among those aged 35-54; however, 16% of them save with the next two years in mind– compared to 7% of 18-24 year olds.
It could be that those aged 55 and above have a greater disposable income, which may explain why they don’t feel the need to focus as much on short-term savings as the younger generations. Figures from TGI** data that those aged 55 and over spend three times as much money on items such as wine and cars compared to 18-24 year olds, and are also the age group willing to spend the
most on cars. In fact, the only area in which the younger generation outspend the 55 plus age group is mobile phones. Those over the age of 55 are twice as likely to spend less than £10 per month on their mobile phone than 18-24 year olds, a quarter of whom have average monthly phone bills of £20-£49.
When it comes to general spending patterns, however, the majority of people in both age groups admitted to managing their money more carefully now than in the past. This is the case amongst six in ten 18-24 year olds and nearly seven in ten people within the 55 plus age bracket.
Saving for retirement
The younger generation may be more pro-active when it comes to short term saving, but those aged 55 and above appear to be better prepared for retirement. Nearly one in two (48%) of 18-24 year olds have yet to start saving for retirement, which is perhaps expected given their young age. That being said, nearly three in ten (29%) of 35-54 year olds and 22% of those aged 55 and over have yet to make any retirement savings.
Across all age groups, the majority of people who do have retirement savings first started putting money aside after the age of 21.
Are you looking for either short or long-term saving solutions?
In addition to both personal and workplace pensions, personal saving accounts are an excellent way to invest your money and boost your retirement funds. The Money Advice Service can help point you in the right direction, or have a look at our retirement calculator to see an estimate of how your savings could potentially grow.