Young people lead the way for austerity
The younger generation is moving away from a ‘buy now - pay later' culture and embracing austerity, with a massive 63% of Welsh 16-24 year olds believing now is a good time to save.
According to new research from Principality, Wales' biggest building society, those in the youth category also demonstrate a refreshing attitude to planning ahead, with 61% of them classing saving for the future as ‘very important'.
This age group was also the most likely to withdraw money from savings to spend on, or lend, to relatives. 13% of those polled admitted they had done this in the last quarter, suggesting young people are more aware than ever of the financial pressure currently faced by families.
The results came as Wales' leading building society launched the latest addition of its Quarterly Saving and Spending Survey to monitor the Welsh attitude to putting money away, which looks at the habits of 1000 people across the country.
Kate Murray, Head of Savings at Principality said: "It is great news that young people are aware that they should be saving for the future. With credit readily available before the credit crunch, we saw a move towards getting what you want immediately, and away from saving for it, and failing to plan for the future. This was simply was not sustainable. With university fees and the rising cost of living, coupled with unemployment figures, it is unsurprising that young people are looking to securing their finances, and making savvy moves like investing their student loans into ISAs."
Attitudes to savings in Wales are firmly polarised. 11% of people surveyed suggested that they do not consider saving money for the future to be important, and less than half believed now is a good time to save, despite the news that the UK could be heading into a ‘triple dip' recession.
People from Cardiff are the biggest savers, managing to put away £789 in the second quarter of 2012, but they were also the biggest spenders - withdrawing a whopping £2,025, nearly treble what they saved.
Over a fifth of Welsh people (21%) failed to save over £100 over the three month period, with women proving to be the biggest savers, banking £604 compared to men, £497. They were also the biggest spenders, withdrawing £977, with both genders spending more than they were able to deposit.
The biggest reason for making a withdrawal in the last quarter was to pay for a holiday, with 19% of people giving this as the reason for raiding their savings. With the summer washout and the Olympics on everyone's mind, this is unsurprising. The double dip recession no doubt contributed to 16% of those polled having to dip in to pay bills, with over a fifth of 35 - 44 year olds having to do this, perhaps in response to the rise of inflation pushing up the cost of living for families.
Kate continued: "The attitudes revealed in this survey suggest people aren't sure what to do when it comes to saving. There is a trend for people to treat savings accounts in the same way as current accounts, making regular withdrawals, which shows that people are having to be flexible in order to weather the financial storm. Fortunately, modern savings accounts have moved away from traditional perceptions, where you have to kiss goodbye to any money for a considerable amount of time to see any returns. If you want immediate access to your money, then you can have it, you just have to choose the right account to meet your needs. With inflation continuing to rise, and no sign of relief, it has never been more important to make sure your money works as hard as it can for you. It is impossible to predict the future, but you can plan for it, and saving money is a route to future security."
For more information, visit principality.co.uk.