BANK ACCOUNTS, CREDIT CARDS

Younger generation are financially sharper than their parents

Younger people are defying the challenging economic times by balancing their daily spend with saving for their future.

Research has revealed that 25-35 year olds are more financially aware than ever before, and have combined short term financial security with long term goals.

Dubbed the ‘foundation generation’, 25-35 year olds are laying the groundwork for their financial future, managing debt and budgeting their day-to-day spend.

The research, carried out by Aviva, showed that 50% of 25-35s had started saving for retirement, either through a workplace pension or a private personal pension.

The average take-home income of those aged 25-35 is £1,144 per month, with many using a significant proportion of their income to save for the future.

89% said they hold a savings account, 41% have invested in a cash ISA and 34% are receiving protection from life insurance.

When asked what they are saving for, over a third said they were saving to buy a house, 34% are aiming to pay off their debts, and 20% are trying to pay off their existing mortgage as quickly as possible.

"With so much concern about people not saving enough for their retirement, it's really good that this younger group of men and women seem to be actively managing their finances and planning for their future,” said Paul Goodwin, Aviva’s Director of Workplace.

“This generation has the ability to make a real difference to their standard of living right up to and through retirement, if they put money aside now for the long-term.”

There is still concern among the younger generation over the state of the economy, with many still feeling the squeeze on their bank accounts.

89% said they have been financially affected by the current economic downturn, with 29% saying they are now more careful with what they spend.

But this has lead to an increased resourcefulness when it comes to money saving, with 40% saying they always look for the best buys or deals.

Tags: BANK ACCOUNTS, money management, money saving, mortgage, saving trends, young generations