Generational Divide in Budgeting Habits

Posted by Tom Magor in Personal Finance on 21 October 2016 - Tom is a Senior Credit Analyst at checkmyfile.

While consumers typically have a lower level of disposable income than has been enjoyed in previous years, it has been revealed that those aged over 55 are half as likely to budget their expenditure, compared to their younger counterparts.

A report compiled by SunLife states that the younger generation are more than 70% more likely to budget than those over 55. A mere 35% of those aged over 55 formally set a budget, representing a 5% reduction since 2015. As a result, almost two thirds don’t plan their expenditure, with 1 in 5 only claiming to have a rough idea regarding their financial situation.

The younger generation are also more likely to utilise technology as part of the budgeting process with a quarter of those aged 18-24 employing either an app or online tool. In contrast, only 3% of over 55s use comparable technology, while a third use a spreadsheet or notebook.

Perhaps due to the higher cost of living, those residing in London are the most likely to devise a budget. 56% of those living in the capital analyse their expenditure, 9% more than the UK average. Londoners are also most likely to utilise technology with nearly a quarter using such tools. In contrast, those residing in Scotland are the least likely to budget with only 40% deriving a detailed plan with nearly 20% stating they only have a rough idea regarding their financial situation.

Ian Atkinson of SunLife says, “It is interesting to see that while overall there is a slight increase in the number of people who are budgeting formally, amongst over 55s budgeting is down while among young people it is up, making that gap between the generations even wider.

“This may just be because there is more technology available to younger people, so using it to budget just comes more naturally, or it could be because they have to watch the pennies. This is a generation that started becoming financially responsible during a recession, are saddled with huge university debt and need to save £33,000 on average just to get on the housing ladder. And now, post Brexit, their financial futures are even more uncertain.

“In comparison, recent figures show over 55s in the UK to be the richest property owners in the world while our research shows they have more than five times the savings of 18-24s (£46,416 on average compared to £9,094 for the 18 to 24s). So it could be that over 55s are not budgeting as much because they don’t really need to.”

Check Your Multi-Agency Credit Report

30 Day Free Trial

Are Car Insurance Premiums Calculated Fairly?

Recently news stories have emerged alleging that a “John” might be more likely to get a cheaper car insurance quote than a “Mohammed”, and that someone with a Gmail account could be offered a lower premium than someone with a Hotmail email address.

Published on 12 Feb 2018 by Jamie Mackenzie Smith

Full Article

The Cost of Incorrect Information on Your Credit Report

Your credit file is compiled from a number of different sources, including payment history from each of your lenders (past and present) and public data as reported by local authorities and courts. The majority of people find that everything held about them is correct, but due to the large amount of information being shared, errors in the information reported can happen, which can lead to issues when you go to apply for credit.

Published on 2 Feb 2018 by Tom Blandford

Full Article

Your Guide to Open Banking

On 13 January, the UK banks embarked upon arguably one of the biggest changes to personal finances since the introduction of computers. Open Banking is aiming to make it easier for banks, lenders and consumers to access and share information, with a view to creating new products and opportunities through innovation and increased competition.

Published on 15 Jan 2018 by Jamie Mackenzie Smith

Full Article

HMRC Bans Credit Card Tax Payments

From 13 January 2018, it will no longer be possible for consumers to use a personal credit card to make a payment on HMRC’s Self-Assessment tax portal. Historically, this has been a popular option as it allows what is often a considerable sum to be deferred.

Published on 12 Jan 2018 by Tom Magor

Full Article

How to Get the Best Deal When Buying a New or Used Car

Buying a new car is both exciting and expensive, but if you know where to look and when, you can grab yourself a bargain. If you take a little time to look into finance or loan deals as well, you can bring down the overall costs significantly.

Published on 11 Jan 2018 by Kevin Pearce

Full Article

Are football clubs exploiting their fans

With Premier League teams under huge pressure to remain in the top flight of English football, the amount lavished on transfer fees and player wages have soared in recent years.

Published on 8 Jan 2018 by Sam Twyford

Full Article

What The 2017 Autumn Budget Means For First-Time Buyers

Wednesday’s autumn budget brought great news to would be first-time homeowners: if you’re buying a home up to the value of £300,000, you won’t have to pay stamp duty for the property. This, the Conservative Party estimate, will benefit 80% of first-time buyers, saving them potentially thousands of pounds on the total cost.

Published on 28 Nov 2017 by Jamie Mackenzie Smith

Full Article

Blacklists - Ten things you probably didn't know

1. Blacklists are not unlawful. No lender is compelled by law to give credit or to give any reason when declining credit. Each may consult several sources of information before making a decision, including any form of list that may exist. Any list containing personal data is automatically regulated by the Data Protection Act 1998.

Published on 9 Oct 2017 by Barry Stamp

Full Article

Is a credit building card a good idea

A credit building credit card is most often used by people that are either looking to improve their credit rating or take out their first credit card.

Published on 24 Mar 2017 by Kelly Luff

Full Article

Which Credit Report Information Can Landlords See

Whenever you rent a property, you will be required to pass some checks set by the landlord or letting agent to prove that you will be a good tenant and that you’ll be able to afford to rent the property.

Published on 7 Mar 2017 by Kevin Pearce

Full Article
keyboard_arrow_left

keyboard_arrow_right

We have loads of great customer reviews