You are here: Home - Saving & Banking - News -

Savvy millennials are surprise savers

0
Written by: Emma Lunn
25/09/2019
Three quarters of 25 to 34-year-olds have a rainy day fund, with an average of £2,200 stashed away.

Almost three quarters (72 per cent) of young people have a savings pot set aside for emergencies, according to MoneySupermarket.

While it’s often assumed that millennials don’t have the cash or inclination to save, research by the price comparison website found that of the 25 to 34-year-olds who have a rainy day fund, more than a third (35 per cent) keep it in a dedicated savings account. A further 27 per cent keep the cash in their regular current account, while 10 per cent keep the extra cash under their mattress.

MoneySupermarket found the main reason millennials put money into a separate savings account is to cover the cost of emergencies, such as a broken boiler (41 per cent). Being prepared for unexpectedly losing a job (39 per cent) and emergency car payments, such as an MOT fail (37 per cent), are also among the top considerations.

Despite dipping into the pot 3.8 times a month for non-essentials, millennials don’t reach into it as regularly as other generations. Those aged over 55 dip into it 4.6 times a month, slightly higher than the national average of 4.2.

Younger generations are much more likely to use the pot for clothes (20 per cent vs 7 per cent), going out to eat/drink (24 per cent vs 6 per cent) and paying everyday rent or bills (38 per cent vs 15 per cent) than those aged over 55.

Despite showing saving willpower, the average £2,262 saved by millennials is 41 per cent less than the £3,826 put aside by those aged over 55.

When it comes to the national saving behaviours, residents in Plymouth are the best at paying into a rainy day fund with £3,527 tucked away. In comparison, people living in Edinburgh have the least saved, at an average of £2,596.

Emma Craig, money spokesperson at MoneySupermarket, said: “Our research highlights that millennials are far more financially savvy than many people think. The concept of a rainy day fund has been around for decades and it’s great to see it’s now popular with the younger generation – putting a little aside each month to build up an emergency fund can really help if and when unforeseen costs crop up.

“If you want to build up a rainy day fund you might want to consider a savings account, such as an easy access, ISA or fixed rate bond. The other option is to get a current account – some accounts offer competitive interest rates that can help make your money go further. However, before applying, it’s always worth checking each bank’s specific account opening criteria and terms and conditions to make sure you get a deal that suits your needs.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

The savings accounts paying the most interest

If one of your jobs this month is to get your finances in order, moving your savings to a higher paying deal i...

Coronavirus and your finances: what help can you get?

News and updates on everything to do with coronavirus and your personal finances.

Everything you need to know about being furloughed

If you’ve been ‘furloughed’ by your company, here’s what it means…

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Money Tips of the Week

Read previous post:
Fraudsters targeting first-time buyers

Young people who have recently bought their first home in the suburbs have become the latest target for financial fraudsters.

Close