Young people get the savings habit

13 April 2012

YOUNG people are best at saving, according to a new report. A survey by National Savings & Investments has challenged the established view that middle-aged and older people are more committed to putting money aside for a rainy day.

The 'best' savers are single people, part time workers and, particularly, young and determined savers, dubbed YADS, aged 16-24, who all save the most as a percentage of income.

The under-25s save more as a percentage of income than any other age group, with more men than women saving regularly, the survey found.

Singles save more than couples or those widowed, divorced or separated, while 'super savers' salting away more than £300 a month are mainly 25-34, professional men in the south, living in privately rented accommodation.

Small savers saving less than £99 a month are mainly those who work part time, are widowed, divorced or separated and are in lower socio-economic groups.

Around a fifth (21%) of the population had £1,000 or less saved, while just 7% had £50,000 or more tucked away.

Three quarters of YADS also had specific goals for their savings, compared to only six in 10 nationally.

Their top savings goals were home purchase/mortgage payment (14%), higher education (13%), and a car (13%). Nationally, savings goals are a rainy day (13%), holiday (11%) and retirement (10%).

Dax Harkins, senior savings strategist at NS&I, said: 'It is encouraging that the young are showing a greater sense of responsibility for their financial future.

'The savings gap is likely to have an impact on most people, but perhaps this new generation will be more prepared.

'The savings ethic shown by those more financially vulnerable groups, may be born of necessity, but shows there is an active desire not to be part of today's culture of debt.

The study was part of NS&I's first quarterly Savings Survey and that will be published every three months.

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