According to a new study from insurer LV, renters among the late-Millennial generation (25-34 years old) are one of the least financially resilient groups in the UK. Based on research conducted with over 9,000 people, the first instalment of LV’s “Income Roulette” research found that more than half (55%) of 25-34 year olds fall short of the Money Advice Service (MAS) recommended amount of savings to be financially resilient. Resilience can be defined as someone who has 90 days’ worth of outgoings in savings, however the research found that a third (34%) of late-Millennials could only survive for one month or less if they lost their income. These figures are even more pronounced for renters of this age, who make up almost half (45%) of the group.
Two-thirds (65%) of 25-34 year olds who rent don’t have the level of savings specified by MAS – almost double the national average (37%) – and 45% could only cope for one month or less without their income. In addition, more than two in five (44%) aren’t confident in their ability to handle a personal financial crisis, again far higher than the UK average (33%).
This group of renters among late-Millennials are particularly struggling with debt, leading to LV dubbing them “Generation Debt”. 43% say they can’t save any money at all with student debt being this group’s biggest obstacle to saving (40%), followed by credit card bills (32%). Half (51%) have some form of unsecured debt and one in five (20%) owe more than £5,000. Further to this, double the national average are in their authorised overdraft (21% vs 11%) and this group are three times more likely to have a loan from friends or family (12% vs 4%). If they were to lose their main source of income, fewer than one in ten (7%) renting 25-34 year olds have a form of income protection insurance to fall back on, despite the fact cover of £1,000 a month can cost less than £10 a month. In fact, almost one in four (22%) would plunge themselves into further debt by putting even more on their credit cards and 3% even admitted they would turn to a pay day lender.