Challenging youngsters to save

The Brownlee brothers | Supplied

A study of 2,000 young people aged 18 to 35, commissioned by NatWest to launch a youth-focused savings challenge, has revealed a notable shift in the savings aspirations of the younger generation when compared with those of their parents.

It found younger people are more likely to prioritise saving towards travelling, attending festivals and wellness, leaning towards spontaneous life experiences over longer-term financial goals.

Some 2,000 British adults aged 18 to 35 years old were surveyed by OnePoll, commissioned on behalf of NatWest, in February this year. The research revealed that while conventional savings goals are still part of young people’s financial picture, priorities have shifted.

Some 29 per cent of young adults who are saving towards long-term goals are allocating 20 per cent or less of their savings towards this, with 50 per cent being focused on medium-term objectives.

NatWest is encouraging young people to build healthy monthly savings habits by launching Couch to Cash: the £5K Challenge. To accompany the challenge,Team GB Olympic gold medallists Alistair and Jonny Brownlee, have created a video series featuring helpful tips to tackle the key barriers to young people saving more. The study highlighted the shift in savings priorities compared to previous generations, with almost half of young people today believing their savings ambitions differ from their parents’ goals at the same age.

Some 47 per cent said their parents would have allocated a greater percentage of income to long-term goals than their offspring are currently, and 37 per cent believe all of their parents’ savings would have gone towards saving for long-term objectives, such as buying a home or paying for a wedding. While almost three-quarters believe they would benefit from new saving strategies to reach their goals, only a third of 18 to 35 year olds had put money into an Individual Savings Account (ISA) ahead of the tax year deadline.

Despite this trend, the majority of respondents (74 per cent) concede that they would like to save more towards their long-term goals.

Mo Watt, savings expert at the NatWest Group, believes the bank’s research sheds welcome light on the generational shift in attitudes to saving

.She adds: “At NatWest, we know that regular savings – no matter how big or small – can add up to make a big difference down the line.“Couch to Cash: the £5k Challenge aims to provide useful tips for those who are looking to get started or want some additional structure to their savings journey.

“Our NatWest Savings Goal Tool can create a plan to help you achieve your goals, whether that’s in the short, medium or long term.”

The bank says that the challenge aims to help young people set realistic savings goals to reach their target – whether that’s £5,000 or a more modest or ambitious amount – based on how much they can afford and how quickly they want to reach their goal.

NatWest customers can use the Savings Goal Tool app to schedule regular payments and track their progress.

Top-ten mid-term savings goal

According to the recent research published by NatWest the top-ten mid-term savings goals for young people are:

1 Travelling (39%)

2 Starting a business (24%)

3 Home decor (23%)

4 Investing in the stock market (22%)

5 Health & wellness retreats (20%)

6 Luxury travel experiences (20%)

7 Investing in cryptocurrencies (18%)

8 A wedding (15%)

9 Buying an electric car (13%)

10 Attending festivals (12%)