There is often a lot of conversation in families about millennials and their attitude to money. Enable’s IFAs have heard a lot about how millennials are not good with their money but some new data suggests otherwise. Revolut, the banking company has found many are saving which is a far cry from their reputation for splashing out on oat milk lattes and avocado toast.
The headline finding of new research based on customer data drawn from the smartphone-based banking service suggests that seven out of 10 young adults are regularly putting money aside. The amount saved is not insubstantial either with almost £174 a month being saved on average, showing perhaps that the UK millennials are “far savvier” about finances than they are given credit for.
Millennials are typically defined as those born between the early 1980s and the late 1990s or the start of the 2000s. The analysed data said it had found 64% of European millennials are saving money on either a weekly or monthly basis – rising to 69% for those in the UK.
Enable’s IFAs know that saving for the future whatever age you are is important and it is interesting to see that the FCA has crunched some numbers to try to find out how feasible it is for a millennial to accumulate the current levels of wealth enjoyed by the baby-boomer generation It compared the average levels of wealth and calculated the percentage year-on-year increase required to bridge the gap. For the average millennial to achieve similar levels of wealth accumulation as those reaching retirement today, they would need to achieve “wealth growth” of about 48% year on year between age 20 and 36, then around 7% year on year between 37 and 51, and then around 6% year on year between 52 and 64.
Unlike baby boomers, millennials typically won’t have repaid their mortgage debt by the time they are in their 60s, says the regulator’s report. But the average millennial is more likely than a baby boomer to inherit some wealth, though this will happen later than previous generations.