12 February 2008 – Aim high, save low – Poll reveals regional gaps in young people’s plans and funds for later life

Far from retiring quietly, young people today expect to be able to afford the things they enjoy now when they retire with foreign holidays, satellite TV and gym membership as standard. With over half the nation’s under 34 year olds not saving anything at all, they are at risk of becoming the ‘big dreams, small assets’ generation.

Young people in the South West are on track for a bigger shock than others across the UK if they don’t start saving for their retirement soon, followed closely by Scotland and the West Midlands. Even in Tyne Tees, where people are most realistic, there’s still a large gap between plans and funds for later life with the Welsh hot on their heels.

A YouGov poll of nearly 2,000 people from across the UK revealed young people are failing to back their plans with hard cash.

Commenting on the survey, Paul Banfield of Best Advice Financial Planning Ltd said:

“It’s great that young people want more and the message to them is simple – you can take steps today to set yourself up for the kind of life you want tomorrow. If you don’t wake up to this opportunity and simply cruise towards retirement with your eyes closed, you may have a rude awakening.”

Heading for a shock

Topping the chart with their heads in the clouds are young people in the South West followed by the Scots.

1. South West – Biggest expectation/saving gap
2. Scotland
3. West Midlands
4. South East
5. East Midlands
6. North West
7. Yorkshire
8. London
9. Wales
10. Tyne Tees

 

Greatest expectations

Young people in Scotland are most likely to believe they can afford their current lifestyles when they stop work compared to just over a third in Tyne Tees.

Sleepiest savers

Two thirds of young people in the South West haven’t started saving followed by just over half of people from the West Midlands and the North West. People in Wales are best at putting cash aside but still a third are not saving anything by the age of 34.

Pensions Minister Mike O’Brien added:

“Work and saving should go hand in hand. Pensions aren’t just for pensioners they are a young person’s issue. If young people don’t have a save now attitude they could miss a trick. Pension pounds work harder the earlier you save – a £1 saved at 20 could be worth up to sixty per cent more at retirement than the same £1 saved at 40.”

For more information contact Vicky Hatchett on: 0203 267 5121 or Kathy Barlow on 0203 267 5128.
DWP Press Office: 0203 267 5144
Out of hours: 07659 108 883
Website: www.dwp.gov.uk

Notes to Editors

1. All figures are from YouGov Plc. Total sample size was 1,956 adults. Fieldwork was undertaken between 28th of December 2007 and 3rd January 2008. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).
2. These figures are from the Department for Work and Pensions and are based on the proposed new personal accounts pension saving scheme which it is intended to introduce from 2012. They include a 3% employer contribution, normal tax relief, likely charges of around 0.5% and depend on reasonable investment growth assumptions. The comparison between values of a single pound is based on before tax figures.
3. Best Advice Financial Planning Ltd are Independent Financial Advisers. The practice covers the UK and specialises in advising young people. Paul Banfield is a Director at Best Advice.
4. More results from the survey:

 

Table 1: Under 34s expecting one foreign holiday a year when retired

Table 2: Under 34s expecting to go to the cinema or restaurant once a week when retired

Table 3: Under 34s expecting to pay for gym or club membership when retired

Table 4: Under 34s expecting to run a car when retired

Table 5: Under 34s expecting to pay for satellite TV channels when retired