Millennials' "live now, pay later" motto has made them clueless about saving and understanding interest rates

Francesca Washtell
Follow Francesca
As Americans Save More, Piggy Banks Gain Popularity
Millennials will need more than a piggy bank if they want to have money in the future (Source: Getty)

Millennials may be a health-conscious bunch that are drinking less and even shunning bacon as part of their lifestyle choices, but they are absolutely clueless about one thing: money.

The “Yolo” (you only live once) generation is getting by on a "live now, pay later" motto, according to new research. A quarter (26 per cent) of young Britons in the lower end of the millennial group – between the ages of 18 and 30 – do not save or invest anything and instead splurge their money on takeaways, coffee and clothes.

More than half (59 per cent) admitted prioritising their spending on going out and other luxuries rather than saving, while almost two-thirds (62 per cent) said they were clueless about savings and investment options, peer-to-peer lending platform RateSetter found in a poll of 2,000 adults.

Read more: Millennials should be saving £800 a month for retirement

Perhaps a sign of the post-recession times, 46 per cent also believed 0.3 per cent to be a reasonable interest rate.

The top regular expenditures for the under 30s were takeaways (47 per cent), meals out (45 per cent) and fashion (27 per cent). TV streaming services (23 per cent) and coffee shop coffees (22 per cent), rounded out the top five.

In another sign of spending for the moment, only a quarter (27 per cent) said they were financially planning for their retirement, despite almost half being worried about it.

Read more: People need to work until their 70s to afford retirement

And perhaps unsurprisingly in the UK's seemingly inpenetrable housing market, just over one-third of Britons under 30 said they cannot imagine owning a house unless they inherit one.

Rhydian Lewis, founder and chief executive of RateSetter, said:

With interest rates languishing at historical lows for several years and recently cut even closer to zero, it is all the more important for young people to ensure that they get on top of their finances and not put their heads in the sand. Putting money to work now could help turn dreams for the future into reality.

Related articles