Baby Boomers are the biggest savers, but Gen Z believe they know how to make their money work hardest for them.
A survey of 2,000 adults found that 66% of those under 27 years old think they can grow their money best; however, it was Millennials who were most likely to use a stocks and shares ISA.
Despite Baby Boomers sticking to old-school savings accounts and cash ISAs, and being more inclined to keep cash in their current accounts, they’ve amassed the largest average savings pot, boasting £27,966, while Millennials manage to save a respectable £5,036 annually.
Jen Adams from Virgin Money, part of the ‘investing made extra’ campaign team, commented on the findings: “The study has been quite fascinating, as different generations approach money in varying ways.
“While Gen Z may be saving the least, they’re full of enthusiasm for new investment opportunities, in contrast to the older generation’s preference for the immediate availability of cash ISAs or the comfort of current account reserves.”
Adams observed, “That said, all generations gravitate towards a predictable rate of return on savings accounts and are potentially missing out on making their money work harder for them by investing.”
Interestingly, it’s the Gen Z cohort who are most committed to saving whatever pennies they can scrape together, whereas Millennials, despite putting money aside, are the most discontented with the growth rate of their wealth.
The latest statistics indicate a surge in financial activity among young Britons, with 38% having already ventured into investing their savings and another 42% weighing up the possibility- the highest interest recorded across age groups.
Despite this, savers still trump investors, as 42% are more inclined towards saving over investing, and only 8% dedicating a greater portion of their wealth to investments compared to savings.
Recent political shifts appear to have invigorated economic confidence, with 32% now believing it is a preferable time to save, owing to political steadiness, leadership, and fresh policies.
Yet, even though 40% express interest in investment opportunities, lack of knowledge remains a significant obstacle but 47% have funds set aside they wish to grow if the right chance presents itself.
In addition, respondents listed steep living expenses, reluctance to risk, and low incomes as the primary obstacles to enhancing their savings.
Looking ahead to financial prospects, about 30% of respondents are set on utilising their funds for retirement enjoyment rather than leaving an inheritance.
Virgin Money’s Jen Adams remarked: “The findings have shown there’s a lot more confidence around saving than investing, which is something the financial services regulator (FCA) have set a target on.
“They’re aiming to reduce the amount of people who have over £10,000 in cash savings by 20% by the end of 2025. However, what people don’t tend to consider is that saving and investing work hand in hand, enabling short and longer-term goals to be realised.
“There’s risk attached to anything in life but investing while saving can provide another way of growing your money. That’s why we’ve launched our new offer giving investors the opportunity to save into a fixed rate savings account with a market-leading rate.”
