Retirees are finding it much easier to save than people of working age – and they have more invested in Premium Bonds as well.
One in four people aged 25 to 49 are saving nothing at all and have no nest-egg in case of an emergency, the YouGov survey commissioned by wealth manager True Potential finds. However, half as many over-65s are struggling to save.
The younger generation is facing a savings crisis, with two in five slashing the amount they save each month as a result of the soaring cost of living. Of those who are saving, one in five are squirrelling away less than £50 a month.
Short-changed: The younger generation is facing a savings crisis, with two in five slashing the amount they save each month as a result of the soaring cost of living
Just one in ten people between age 25 and 49 have money in Premium Bonds, compared to a third of pensioners. Daniel Harrison, chief executive of True Potential, is urging the Government to do more to help younger generations set aside money for the future, including scaling up pension auto-enrolment and setting up a similar scheme for automatic saving.
At the moment, employees in the private sector must pay a minimum of five per cent of their earnings into their workplace pension, unless they opt out of auto-enrolment.
Employers must contribute at least three per cent, bringing total minimum contributions up to eight per cent.
Harrison says: ‘Scaling the pension auto-enrolment rate up gradually to 12 per cent and introducing a new auto-saving scheme which could be increased to an additional 8 per cent over the next decade would get our overall savings rate more in tune with that seen across other developed nations.’
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