The research, which was conducted by You Gov on behalf of insurance provider Paymentshield shows that the biggest savers are 25-34 year olds who save £299.43 on average each month, whereas among 45-54 year old, the average saving is just £169.18 monthly.
Over a third (37 percent) of 45-54 year olds admit to not saving anything each month whereas just 29 per cent of 18-24 year olds aren’t putting anything away for a rainy day.
Tim Johnson, CEO of Paymentshield commented:
“Young people clearly have good intentions when it comes to saving, most likely because of the challenges in trying to get on the housing ladder however, given current economic pressures people simply aren’t saving enough.”
The findings also show that the majority of people wouldn’t be able to cope financially if their income was to stop. Only 32 per cent of people felt that they would be able to cope financially for more than three months without their regular income.
Loving the luxuries
When it comes to spending, over half of 45-54 year olds (54 per cent) see budgeting for holidays as an important monthly expense, whereas just 26 percent of young adults (18-24 year olds) have the same opinion. The first group is also more likely to use a credit or store card to pay for luxuries (17 per cent vs 5 per cent), unlike 62 percent of 18-24 year olds who will use their regular income.
Divorcee debt dilemma
Divorcees in particular are struggling to save, with around half (51%) not saving anything at all. Of those divorcees that do put money away, the majority (24 per cent) only save up to £49 each month. This seems at odds with the fact that almost two thirds (60 per cent) of this group are worried about their finances and keeping up with their general outgoings.
Johnson concludes:
“In uncertain economic conditions with high unemployment and state benefits being reduced, people need to make adequate provisions in case they find themselves unable to work due to accident, sickness or unemployment. With people clearly struggling to save enough to cope for more than a few months if, they should be seriously considering products such as income insurance to protect their financial future.”
