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ONS finds age gap in Covid-19 finance worries

22/06/2020

If you are covering the latest ONS data on the social impacts of Covid-19, please see the following commentary from Rachael Griffin, tax and financial planning expert at Quilter.

The data shows that the under 60s are much more likely to report feeling an impact on their household finances. People aged 16-29 were significantly more likely to report an impact on their finances (30%) than those aged 60+ (13%). Among young people with financial worries, a loss of income (84%) and being unable to save (38%) were the most common problems.

 Rachael says:

 “Almost one in three young adults reported a financial hit due to Covid-19. Many young people will be really worried about their career prospects. If they’re just entering the workforce then it is obviously a difficult environment to be looking for your first job. And for those already in work, they have less experience on the CV to give them confidence that they will be able to find a new position if they are made redundant. That means that many of them are particularly worried about the risk of a loss of income.

“It is also likely they will have fewer financial resources to fall back on if they face financial difficulties, whereas older age groups are more likely to have savings and assets they can rely on if they suffer a loss of income.

“This is borne out in research conducted by Quilter. Among over 75s, more than 70% of people said they felt financially prepared for Coronavirus crisis. But this figures falls to 42% among 18-30s. They key drivers that made people feel more financially secure were having adequate cash savings to fall back on, being debt free and having income from other sources, such as investments.

“It is a financially difficult time for many people, but especially for young adults. For obvious reasons, young people are less likely to have had an opportunity to build up substantial savings. And they may also have sizeable borrowings, such as a large mortgage if they’ve recently bought a home with a large loan-to-value ratio.

“The most important thing they can do to try and give themselves a sense of financial security at the moment is to ensure they have some cash savings set aside for a rainy day. Figures from the Money and Pension Service suggest that around 11 million people have less than £100 in savings. That isn’t going be enough if you experience a loss of income. As a consequence, people may find themselves borrowing to meet day to day costs, which is where problems arise. For those that are able to do so, building up some cash reserves provides an important financial buffer against a shock and will leave you feeling more secure and confident that a financial challenge won’t cause a ripple effect that leads you into further problems.”

For more information contact

Michael Glenister020 7778 963807469 144535michael.glenister@quilterinvestors.com

Notes to Editors:

About Quilter plc:

Quilter plc is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Quilter plc oversees £95.3 billion in customer investments (as at 31 March 2020).

It has an adviser and customer offering spanning: financial advice; investment platforms; multi-asset investment solutions; and discretionary fund management.

The business is comprised of two segments: Advice and Wealth Management and Wealth Platforms.

Advice and Wealth Management encompasses the financial advice business, Quilter Financial Planning; the discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

Wealth Platforms includes Old Mutual Wealth UK platform and Quilter International, including AAM Advisory in Singapore.

The Old Mutual Wealth Heritage life assurance business was acquired by ReAssure Group Plc on 2 January 2020.

Since its IPO in June 2018, Quilter plc’s businesses have progressively rebranded to Quilter, as follows: 

  • Quilter Financial Planning (previously Intrinsic)
  • Quilter Private Client Advisers (previously Old Mutual Wealth Private Client Advisers)
  • Quilter Financial Advisers (previously Charles Derby Group)
  • Quilter Financial Adviser School
  • Quilter Cheviot
  • Quilter Investors
  • Old Mutual Wealth (becoming Quilter Investment Platform)
  • Quilter International (previously Old Mutual International)

This press release is for journalists only and should not be relied upon by financial advisers or customers.

Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

This communication is issued by Quilter plc.  Registered office: Millennium Bridge House, 2 Lambeth Hill, London EC4V 4AJ, United Kingdom. Registered number: 6404270.  Registered in England.