More than a third of under 35s have no savings

More than a than a quarter of Brits have no savings at all, with this rising to 37% for those aged 18-34, according to research from SunLife.

The study, which looked at the savings habits of 3,388 households, also found that the majority of 18-34s with no savings say it is because they don’t have any spare cash, either because  they spend all their money each month (55%) or they use any spare to pay off debts (35%).

For almost a quarter (24%), the reason is because ‘they haven’t got round to it’ while 3% say they ‘don’t see the point’.

Average savings

The average amount 18-34s have in savings is £7,693, less than a quarter of the average held by the over 35s (£33,421) and less than a third of the national average (£26,785).

Of those under 35s that do save, almost two in five save in a jar– that’s more than have a Cash ISA - while more than half of young adults save using their current account rather than a specific savings product.

The five most popular ways 18-34s save are:

Current account (52%)

Instant access savings (48%)

A jar/tin (38%)

Cash ISA (31%)

Premium bonds (8%)

The new Lifetime ISA, announced in yesterday’s Budget, aims to get people saving for homes and their retirement.

Ian Cooper, head of savings at SunLife said: “While putting pennies into a jar can be a good way of stopping yourself from spending lose change, jars and tins were never intended as secure homes for hard earned cash.

“Not only is it very tempting to raid rather than leave for a rainy day, but it isn‘t earning a penny in interest and doesn’t stand a chance against inflation.

“Saving doesn’t have to be a huge commitment; just think about putting a little something aside each month because even a small amount of money saved or invested regularly can build into a sizeable sum over the years.

“Hopefully the chancellor’s announcement in yesterday’s budget for the launch of a Lifetime ISA, where savers can get a 25% bonus from the Government, will encourage more young people to start saving for their future.”