Over half (51%) of 25 to 34 year olds do not feel financially resilient, meaning they would struggle to recover from a financial shock or loss of income, while a third of them have no savings, according to the Office for National Statistics (ONS) report How well are you doing compared with other young people?.
The report further revealed that those aged 22 to 29 have become less likely to own a home, with the proportion of homeowners having fallen by 10% between 2008 and 2017, from 37% to 27%.
Despite this, younger people are now less likely to be in financial debt. Approximately 37% had financial debt (excluding student loans from the Student Loans Company), down from 49% in 2008 to 2010. However, those in debt owed more (£1,900) on average, than in 2008 to 2010 (£1,800).
Statistics published by Zurich UK found that younger people also made sacrifices in a bid to improve their financial situation. A third of 25 to 34 year olds have given up their car, while 42% of them having given up their home, as well as making smaller sacrifices such as not purchasing “luxury” food items or not buying lunch while out, at 18% and 17% respectively.
Commenting on the findings, Zurich UK head of strategic partnerships Rose St Louis said: “It’s a tough time financially for consumers, but particularly for young people.
“Soaring house prices and increasing rent costs are making owning your home a pipe dream. While wage growth is starting to pick up, months of low wages coupled with high inflation and soaring university debt, is impacting how resilient young people feel with their finances.
“But it's not all doom and gloom, there are steps young people can take to improve their finances. Feeding a small amount each month into a stocks and shares ISA or a pension fund is a sensible way to build a healthy sum over the years. Similarly, making the most of government products when saving for a first home, such as a Help to Buy ISA or LISA can bring huge benefits over time.”
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