Millennials start early on the savings ladder

Millennials start early on the savings ladder

Millennials have set aside more into savings accounts than any other generation, research has found.

According to research by Charter Savings Bank, people aged 18 to 34 - the so-called millennials - are getting on the savings ladder as early as possible.

The research, carried out among 2,000 adults in the UK by Opinium, found that Millennials saved more in 2016 than any other generation, with an average total of £3,701 in 2016.

This was more than £450 higher than their baby boomer and Generation X counterparts, who saved £3,226 and £3,238 respectively.

Commenting on the findings Paul Whitlock, director of savings, at Charter Savings Bank, said: "Millennials have come up trumps when it comes to saving money in 2016, beating the older generations to the title of top savings generation.

"However, what is most encouraging is that the level of people putting money away is so high across the board, and few have been hindered by the low interest rate environment or the economic uncertainty brought about by the UK’s decision to leave the EU."

According to Mr Whitlock, 2016 was undoubtedly been a turbulent year for the UK and savers alike. Interest rates set by the Bank of England were already at an all-time low and, following Britain’s decision to leave the EU, took a further hit in August down to 0.25 per cent. 

This has meant that everyone has had to work even harder to make their savings work for them.

Despite this, 78 per cent of millennials were able to save some money in 2016, with nearly two in five making regular monthly saving deposits during the year. 

When asked why they had committed to saving, 14 per cent said they believed regular savings were beneficial to their overall pot, with 18 per cent citing their desire to purchase a home in 2017. 

Mr Whitlock said: "Our attention now firmly turns to 2017, and a year in which savers could enjoy some well-deserved relief as the Bank of England keeps a close eye on interest rates. For now, people across the UK should use the New Year to put at least one savings resolution in place and start 2017 with their best foot forward.”

At a time when inflation is set to rise – perhaps even between 2.7 per cent and 3 per cent by the end of the year, according to industry consensus -  low-paying cash savings accounts look less attractive than investment-based savings plans that can beat inflation.

For example, the UK stock market, which opened at 7,142.83 on the first day back to work of the New Year – its highest ever level.