Millennials: spending not saving

A flurry of articles this week put the spotlight on the financial future of ‘millennials’. Holidays may feature prominently for this generation but savings, pensions, investments less so.

For some millennials, forward financial planning may not go much further than buying a lottery ticket on Thursday for Saturday’s draw, so getting them to think about their retirement and pension options may be tricky. This is largely down to a lack of stability in the job market, graduate debt, a challenging housing market and in many cases, a lack of sound financial education. A recent article in the Financial Times (FT) on this very subject has advised investors and the financial industry to pay close attention to how these so-called ‘noughties’ are ‘ripping up the financial rule book’. You might think ‘so what if they spend not save?’ but according to the FT their pattern of consumer spending is reshaping the economy as we know it – indeed they form the backbone of tomorrow’s economy.

Who are they?

They were born from the early 1980s to early 2000s. Many would have been at university at the height of the financial crisis (paying fees of up to £9,000+ a year).

Where are they?

Thanks to home-ownership being a distant dream for a lot of millennials, they can usually be found sharing rental accommodation or back at home with their parents.

What do they want?

Freedom, big salaries, big bonuses, fun and flexible working environments…and lots of lovely free stuff. Or even just a job.

When do they want it?



There is plenty in the news about middle-aged savers not having enough to retire on, but what about the millennials? The current pensions system was designed during the era of jobs for life but things have changed. According to the Chartered Institute for Securities and Investments, today’s 25 year-olds need to save the equivalent of £800 a month over the next 40 years to retire at 65 with an income of £30,000 a year. With the current cost of living making this look nigh on impossible, it’s not hard to see why the millennials would give up on the idea of saving for retirement.

A survey by Facebook found that more than half of the millennial respondents said they had no one to turn to for financial guidance. Perhaps it’s time to tap into this market?


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