Young top savings poll, finds National Savings & Investments

Young people are the most prolific savers in the country, a survey by National Savings & Investments has found.

10:06 08 December 2004

Young people are the most prolific savers in the country, a survey by National Savings & Investments has found.

The poll found that those aged 16-24 are the nation's best savers, beating the national savings average in every category in the survey.

The young were found to be saving regularly, saving the highest average proportion of their income (9.8 per cent), and have the clearest savings goals when compared with all other age groups.

After the young, singles and part-time workers have the strongest savings ethic, National Savings found in its first published survey.

Singles save 8.9 per cent of income, compared with 6.3 per cent for those who are widowed/divorced or separated and 5.9 per cent people who are married or cohabiting.

Similarly, part time workers saved 8.0 per cent of their income, compared with 7.2 per cent for those in full time work.

While the 16-24 group save the most by a considerable margin, they also held the least money in reserve.

More than twice as many 16-25 year-olds had less than 1,000 in savings than any other group. In total 47 per cent of young people had under 1,000, while one in seven (15 per cent) over 55s has more than 50,000 in the bank.

The average number amount held in savings was 16,454 - excluding pensions.

"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," commented Dax Harkins, senior savings strategist at National Savings.

"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," he added.

The top savings goals for the young were home purchase/mortgage payment (14 per cent), higher education (13 per cent), and a car (13 per cent).

Over the country as a whole people saved for a rainy day (13 per cent), a holiday (11 per cent) and retirement (ten per cent).

National Savings also found that of all the savings products on the market in the last three months of 2004, cash mini ISAs consistently offered the best returns.