Young, free but no spending spree: Half of young Brits worry about money most of the time

June 12, 2015

While many view the Millennial* generation to have a carefree view of both commitments and finances, it seems the impact of the financial downturn on this generation is causing sleepless nights. New research from Mintel reveals that half (51%) of Millennials today worry about money most of the time, rising to almost three in five (58%) women.

And it seems this has moulded them into a generation of cautious spenders, with just 30% agreeing they are comfortable using credit to pay for things that they couldn’t otherwise afford.

This conservative stance on debt is coupled with a negative outlook for their generation’s future. Over half (57%) think their generation is or will be worse off financially than previous generations and 55% say it’s unrealistic for someone of their age to expect to retire before the age of 65.

51% of Millennials today worry about money most of the time, rising to almost three in five women

Chryso Kolakkides, Senior Financial Services Analyst at Mintel, said: “Although the UK economy is gaining steam and youth unemployment continues to fall, many Millennials still feel disadvantaged, particularly those who entered the workforce when things were at their worst. Millennials who already began their careers with depressed salaries during the periods of economic turmoil can find it difficult to climb the ladder. At the same time, many have seen their families struggle with their finances, or have experienced economic hardship first-hand, giving them a better appreciation of the importance of sound money management. They understand the importance of prioritising saving and paying off debt over spending, and the financial crisis has pushed these young adults to think and worry more about their financial future.”

However, it seems male Millennials are more comfortable than their female counterparts when it comes to their finances. Just a third (33%) of women aged 16 to 35 are confident that their finances are in good shape, compared to almost half (47%) of men. In addition, a quarter (26%) of women are comfortable using credit to pay for things that they couldn’t otherwise afford, compared to a third (34%) of men.

Millennials are also keen to keep up to date with the financial services market. Almost two thirds (63%) say that it is important to spend time researching the best ways to save or invest money, with 14% strongly agreeing. What’s more, two in five (41%) say they enjoy learning more about personal finances.

However, it does seem that many find the market confusing, with half (48%) agreeing that information on finances and investing is generally difficult to understand.

“The majority of Millennials understand the importance of monitoring the market. However, a willingness to keep up with the market does not necessarily translate into action, particularly as many young adults have very few savings available to invest. With interest rates at an all-time low across the board, even the cash benefit of switching savings account is marginal for all but the heaviest savers.” Chryso adds.

Whilst this generation has a more forward-looking, conservative approach to finances, when it comes to their saving motivations they also reveal a tendency to prioritise experiences over possessions. Even though building up a safety net for protection against rainy days or unexpected events is one of the most common reasons for saving, holidays are also a high priority. Over two fifths (43%) of Millennial savers/investors, or potential savers/investors, say they are saving for a holiday or travelling compared to 36% who are saving to buy a house or a flat and 23% who are saving for when they have children.

This is also in line with their life goals as Millennials rank going travelling or seeing the world (40%) in their top three priorities, alongside improving their health or wellbeing (41%) and being married or in a long-term relationship (42%).

“Millennials are a very driven generation, with big life goals and aspirations. They choose what is important to them based on a broader definition of success and one that is more attuned to experiences rather than material goods. Even though certain goals such as relationships, buying a house or having children are all top priorities, these are longer-term goals for young adults. Travelling is a more immediate priority, and it is highly prized by most in this generation, whether they are younger or older Millennials, married or single, parents or childless.” Chryso concludes.

*Mintel defines Millennials as UK consumers born between 1980 and 1999.

Press review copies of Millennials and Financial Services UK 2015 report and interviews with Senior Financial Services analyst, Chryso Kolakkides, are available on request from the press office. 

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