Cautious Gen Z are curtailing their spending at pubs and clubs and spending their money on insurance instead. A survey of 2,000 adults revealed the nation’s spending priorities for the next 12 months.
More than one in three (35 percent) 18-24 year olds plan to spend more on insurance, compared to just 11 percent of 45-54 year olds. It comes as it was discovered that Generation Z already had more insurance coverage for their personal belongings than older age groups.
The younger generation is four times more likely to insure their jewelry than 55-64 year olds (35% to 8% respectively), and twice as likely to protect their watch (26%) compared to the older group age . It also emerged that 37 percent of 18-24 year olds will spend more on family experiences, compared to just one in ten of 55-64 year olds.
Among all age groups, eating out (31%), vacations and travel (27%), and clothing (22%) are the things people are looking to spend the most money on. However, the UK’s vibrant nightlife sector may be struggling, with only one in ten planning to spend more money in pubs, clubs and on alcohol.
Claudio Gienal, chief executive of AXA UK and Ireland, which commissioned the research, said: “The cost of living crisis has understandably made many people nervous about what lies ahead. The Chancellor’s decision to reduce the basic income tax rate from 20% to 19%, an increase in the threshold for paying National Insurance (NI) by £3,000 and the reduction of fuel tax by 5p, shows that the government knows that budgets are squeezed.
“But despite this challenging climate, our research highlights the value we place on experiences with family and friends, and the importance of spending time together. In these uncertain times, it is also interesting that younger age groups are more likely to protect their assets through insurance and, in general, people plan to buy more insurance in the coming year.
“This suggests they don’t see insurance as a luxury, but as a vital safety net that allows them to get on with their lives and do the things they love.” The study also found that when it comes to budgeting over the next 12 months, a quarter (24%) of adults plan to spend less on clothing, while others will cut back on eating out (19%) and shopping . electronics and gadgets (18 percent).
Others will also cut back on jewelry (17 percent) and home improvement (16 percent). Nearly one in four (24 percent) of Gen Z plan to spend less on cars in the coming year, while more than a quarter of 45-54 year-olds expect to reduce their eating out habits.
But while 60 per cent of men believe they are careful shoppers, compared to 53 per cent of women, men spend more on impulse purchases: £21 per week, compared to £16.60 per week. And Gen Z spends more than any other age group on impulse purchases, shelling out £28.80 a week, compared to just £11.90 for those aged 55-64.
The younger generation also plans to spend three times as much money on coffee to go compared to those over 55. Londoners spent £30.30 on impulse purchases, with Northern Ireland (£23.80) and the North East (£20.80) the top three regions.
The East Midlands (£13.20), the South West (£14.80) and the South East (£15.40) were the most frugal regions, according to the OnePoll survey. Claudio Gienal added: “It is fascinating to see how the nation plans to spend its money in the coming months.
“An uncertain economic environment is creating a generation gap, meaning that different age groups are prioritizing different activities when it comes to their spending. The lifting of coronavirus restrictions may explain why more than a quarter of Britons plan to spend more money on holidays and travel, despite rising inflation and economic uncertainty.
The jump in the cost of living is putting pressure on household budgets, with some having to choose between heating and eating.
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GEN Z TOP SPENDING PRIORITIES FOR THE NEXT 12 MONTHS:
- Coffee to go: 37%
- Insurance – 35 percent
- Clothing – 33 percent
- Eating out: 33 percent
- Cars and vehicles: 31 percent
- Electronics and gadgets: 30 percent
- Jewelry – 24 percent
- Nightlife socializing, such as nightclubs, bars, and pubs: 19 percent
- Home improvements: 18 percent
- Furniture – 16 percent