The late millennial generation - those aged between 25 and 34 years old - are one of the least financially resilient groups in the UK, according to new findings from LV=.
Its ‘Income Roulette’ research found that more than half (55%) of millennials in this age group fall short of the Money Advice Service’s recommended savings amount of 90 days’ worth of outgoings.
This rises to two thirds (65%) when you look at the renters who took part in the insurer’s research (45% of the 9,000 people surveyed were renters) - almost double the national average (37%).
Even more worrying, is that a third (34%) of this age group could only survive for a month or less if they lost their income, rising to 45% for renters.
In addition, more than two in five (44%) aren’t confident of their ability to handle a financial crisis - higher than the national average of 33% - while four in 10 (43%) renters are unable to save any money each month.
But it’s not just saving that this age group is struggling with, LV= reports that late millennial renters are also struggling with debt.
Of the renters surveyed, four in 10 (43%) said they can’t save due to student debts, while a further three in 10 (32%) have credit cards debts. Half (51%) have some form of unsecured debt, 21% are in authorised overdrafts, and 12% have a loan from friends or family. One in five (20%) owe more than £5,000.
Justin Harper, head of policy for protection at LV=, says: “It’s worrying that so many older millennials have no idea how they would cope in a personal financial crisis, but those stuck in the cycle of renting are suffering even more. It’s clear that people in this ‘Generation Debt’ are at risk of finding themselves struggling to make ends meet if they lost their income.”
To tackle financial insecurity in the UK, among older millennials who rent, LV= is calling on the government to ensure that the new Single Financial Guidance Body (SFGB) has a specific remit to focus on increasing financial resilience among consumers.
It believes this should include looking at the role of individual income protection insurance and considering how the government and industry can increase the take up of private insurance to protect consumers against financial shocks.