- Young people 50% more likely to have been furloughed, and twice as likely to have been made redundant or looked for a second job in the past year compared to general population
- Majority of people aged 18-30 (56%) say they are more likely to regularly add to their savings now than they were 12 months ago, and feel more financially cautious
- Those who managed to add to their savings pot did so to the tune of £1,500 on average, or the equivalent of £15bn UK-wide
- OneFamily is launching climate-friendly ISAs and LISAs to support these environmentally aware savers
The financial impact from Covid-19 has hit under 30s particularly hard – and the experience has made the group more financially cautious and likely to save for the future.
This is according to research from financial services provider OneFamily, which suggests that 18-30-year-olds have disproportionately borne the financial impact from Covid. Compared with the general population, young people are 50% more likely to have been furloughed and are twice as likely to be made redundant or need to find a second or third job1.
But the tough lessons taught by the unexpected turmoil of Covid mean more than half (56%) of 18-30s say they are now more likely to regularly add to their savings than they were at the start of 2020. Similarly, at a time when interest rates are at an all-time low, 38% are more likely to regularly add money into stocks and shares-based investments.
Understandably, the financial situation means that for some, saving is currently out of reach – 9% of 18-30s have not had any money in savings in the past year, while a further 13% have saved less regularly.
On average, the young people who did manage to save added £1,480 to their pot in the last 12 months. That equates to almost £15bn2 saved among 18-30-year-olds across the UK.
Long-term security, following the pandemic, is the driving force for many who said they were more likely to save now. Around three in 10 under 30s are saving to put down a deposit on a house (30%) after being stuck inside the same four walls for most of the year.
Major life events that have been put on hold also influence savings habits, with one in six (16%) looking to save for education, and one in 10 for a wedding (11%) and retirement (10%). Overall, a majority (63%) say they feel more anxious in general about the future since the pandemic, indicating adding to savings is a way to help offset this worry.
Paul Bridgwater, Head of Investments at OneFamily, said: “It’s been a tough time for all of us, so it’s understandable that the generation that’s been hit hardest is now more cautious about spending and are determined to build their savings.
“We’re regularly in touch with our customers, and hearing about what matters the most to them. With so much uncertainty, protecting against future risks like recessions, pandemics and employment comes up a lot in the under 30 age-group. But even with this pressure, many in this group don’t want their money to go into funds that support companies that damage the environment. The future of the planet is just as much of a priority too.”
It doesn’t look like financial prudence will go out of the window once the pandemic is over. Most 18-30s (57%) agree that they’d generally rather stay at home with Netflix and a takeaway than go out to a party, bar or club while just under two-thirds (63%) say their experiences in the past year mean they’ll be more cautious with spending in future.
Paul Bridgwater continues: “For many young people saving for a home, after living with parents or in a rented living space that they weren’t able to make their own in the past year, it’s worth them looking into whether the 25% government bonus on a climate friendly Lifetime ISA might help to boost their savings pot whilst also appealing to their environmental ideals.
“Meanwhile for those not looking to save specifically for property or retirement, a climate friendly stocks and shares ISA could help them to build their savings nest-egg at a time when interest rates are at a historically low level.”
OneFamily’s new stocks and shares-based ISAs and Lifetime ISAs invest in forward-thinking, climate-friendly companies who are committed to reducing their impact on the environment. To find out more about OneFamily ISAs, visit: onefamily.com/isa/ and onefamily.com/lifetime-isa/
Notes to Editors
Unless otherwise stated, all research conducted by Opinium, on behalf of OneFamily, between 29th January and 1st February 2021, among a nationally representative sample of 1,003 UK adults aged 18-30.
- OneFamily research, conducted via Opinium, asked a nationally representative sample of 18–30-year-olds and a nationally representative sample of UK adults of all ages the same question – “Thinking about the last year (from Jan 2020 – Jan 2021) have you experienced any of the following?” and gave the same set of options to both sets of respondents. 15% of 18-30s said they had been furloughed, compared with 10% of the general population; 6% of 18-30s had been made redundant, versus 3% of the general population; while 5% of 18-30s had looked for a second job and a further 5% a third job, compared with 2% of the general population.
- ONS data says there are an estimated 11,065,346 people in the UK aged between 18 and 30. OneFamily’s research, conducted by Opinium, finds that 91% of this age group have saved in some form over the past 12 months – the equivalent of 10,039,347 savers. With this group saving £1479.70 on average in the past 12 months, this equates to £14.86bn being saved.