Millennials should not be categorised as the ‘YOLO’ generation when it comes to saving, according to Graham Vidler, director of external affairs at the Pensions and Lifetime Savings Association (PLSA).
“’YOLO’ means ‘you only live once',” Vidler explained, speaking at the PLSA’s Future of Lifetime Savings Hot Topic seminar in London. “What stood out, in our research, is that the idea this is a YOLO generation doesn’t hold true when you speak to them.”
PLSA research found that 51% of millennials get more satisfaction from saving money than spending it, and 53% disagreed with the idea that they tend to live for today and let tomorrow look after itself.
However, 43% of respondents said they are unable to save because their salary is too low. “This is the first generation predicted to earn less than their parents,” Vidler said. “That is a very significant fact.”
Resolution Foundation research has found that the typical millennial earned £8,000 less than the preceding generation – Generation X – in their twenties.
Despite the fact that 83% of millennials held some financial wealth, the research found that they tended to keep it in places where only returns could be gained. Three-quarters (76%) keep their money in a savings or current account, and 19% use cash ISAs.
However, only 7% of workers under the age of 30 had chosen to opt out of automatic enrolment in their organisation's pension scheme. The greatest increase in participation between 2013 and 2014 was seen for those aged between 22 and 29, an increase of 19%.
“This research challenges the perception of millennials,” Vidler said. “We usually hear millennials are whiny, that they have a terrible attitude to money, they can only engage with virtual things or things on social media, or that they can’t even place an order at McDonald's without the use of a touchscreen.
“However, 57% have no debts apart from their student debt, and 65% do not acquire any debt on a monthly basis. The facts don’t match common views.”