Young Brits are ditching long-term financial savings – what they’re spending on as a substitute

Young people are prioritising travelling and wellness over long-term saving goals according to a recent survey

A recent survey has revealed that young adults are shunning long-term savings goals in favour of travel, wellness and cryptocurrency investments. The poll, which surveyed 2,000 individuals aged between 18 and 35, found that half of the respondents have short-term financial goals spanning six to 18 months.

The study was commissioned by NatWest, as part of their initiative to encourage young people to develop healthy monthly savings habits through their Couch to Cash: the £5K Challenge. The bank has teamed up with Team GB Olympic gold medallists Alistair and Jonny Brownlee to offer useful advice on overcoming the main obstacles to saving.

The bank has teamed up with Team GB Olympic gold medallists Alistair and Jonny Brownlee to offer useful advice on overcoming the main obstacles to saving.

Travel tops the list of short-term financial goals for this age group (39%), followed by 24% who aspire to save enough to kick-start a business. Other popular saving objectives include health and wellness retreats, wedding expenses, and purchasing a car.

While only 40% are putting away funds for long-term goals such as housing deposits, 74% of those would like to be saving more towards their long-term goals.

Almost all of those who save money utilise different saving pots, with 45% having three or more but three quarters believe new savings strategies would help them achieve their targets.

Currently, only a third have utilised their Individual Savings Account (ISA) 2024/25 tax year allowance, although 35% who haven’t plan to do so before the early April deadline.

Mo Watt, a savings expert from NatWest, commented: “We know that regular savings no matter how big or small can add up to make a big difference down the line.

“The challenge aims to provide useful tips for those who are looking to get started or want some additional structure to their savings journey.”

Almost half of people believe their parents would have saved a larger proportion of their income towards long-term goals.

ALISTAIR AND JONNY BROWNLEE’S TIPS TO TACKLE THE KEY BARRIERS TO SAVING:

1. Focus on your future self Keep your long-term goal in mind to stay motivated
2. Visualise your goal Picture what you’re saving for to help stay on track
3. Take small steps Set achievable short-term goals and celebrate progress
4. Try loud budgeting Share your savings goal with others to stay accountable
5. Build small habits Consistent saving habits can lead to big results
6. Celebrate your wins – Acknowledge milestones to keep yourself motivated
7. Automate your savings Set up a regular payment to grow your savings effortlessly
8. Use Round Ups Automatically round up purchases and save the spare change
9. Boost your savings Look for cashback, rewards, or perks to top up your savings
10. Set a timeline Give yourself a deadline to stay focussed on your savings goal