A new study from LV Insurance reveals that people in their early thirties are putting off life milestones such as having children or buying a home, due to being one of the least financially resilient groups in the UK.
A quarter (24%) of the 30-35 year olds in the study, generally classed as millennials, of which there are 4.7 million in the UK, feel worried about the financial impact of life milestones – double the national average (12%) . Nearly one in six (17%) say they’ve put off major life milestones because they don’t feel financially mature enough.
LV has worked with Dr David Lewis, an associate fellow of the British Psychological Society, to identify this group as the ‘Peter Pan Generation’. Separate research by Dr Lewis revealed that seven out of 10 of those under-35s believe their youthfulness will last forever, so they don’t properly prepare for risks the future may hold.
Insurance-Edge has a newsflash for you hipsters; you’re going to get old, develop illnesses and die like everyone else. You’re welcome.
Unable To Budget Or Plan For Hard Times
Following on from the LV Income Roulette report last year, the insurer’s latest study has found that more than seven in 10 (73%)of this age group fall short of the Money Advice Service (MAS) recommended amount of savings to be financially resilient, versus a national average of 56%. The research revealed a further one in five (22%) in their early thirties don’t know how long they would be able to cope financially if they found themselves unable to work – for instance, due to illness or an accident. Despite this, fewer than one in twelve working adults (7%) have their own Income Protection insurance in place.
Justin Harper, Head of Policy for Protection at LV, said: “Its deeply concerning that many of those in their early thirties are delaying major life milestones because they feel worried and ill prepared financially. And it is worrying that so few of the Peter Pan Generation can withstand the financial effects of an unexpected income shock – they have no Plan A, nor a Plan B.
Dr Lewis commented: “There are multiple reasons this age group isn’t properly preparing for financial risks. A universal emphasis on the importance of ‘staying young’ means many people are in a state of denial or avoidance when it comes to facing up to the future. We also tend to talk within – rather than across – generational groups, which encourages us to focus inwardly on the present, not the future.
“Previously younger generations would likely inherit their parents’ estate while relatively young, but increased life expectancy means this is no longer the case. By not giving proper weight to their financial status, this group could be at risk of finding themselves with a significant level of responsibility without adequate financial preparation or protection.”
To find out more information about protecting yourself financially if you were unable to work because of an accident or serious illness, speak to a financial adviser or go to https://www.lv.com/income-protection