Updated 03 December 2020
Financial advice might be the new rockânâroll. Younger adults are smashing up the stereotype by being more financially astute and forward thinking than their elders. Could this be a fightback from Generation Austerity?
They say that age brings wisdom, and that the young are impulsive. It turns out that âtheyâ might have it the wrong way round. When it comes to making financial decisions, todayâs hot-heads are more likely to be grey, while the know-it-all youngsters are queuing up to see financial advisers. Whatâs going on?
Itâs reached the point where as many under-35s as over-55s are seeking advice about retirement â and thatâs the only area in which the generations are evenly matched. Everywhere else, from property purchase to investment to running a business, the younger generation is more likely to have sought professional advice. You might think this is simply because older people arenât doing those things so much anymore â but the research by unbiased.co.uk looked at the key events in the lives of respondents past and present, and found that todayâs under-35s are much more ready to ask for expert help than their parents were.
Greater awareness is one possible reason â the internet has opened our eyes to whatâs out there â but thereâs more to it than that. New adults are entering an economic world that their parents would scarcely recognise: interest rates at historic lows, property prices off the scale, mortgages harder to secure, equity markets less predictable â and a more confusing range of financial choices than ever before. It is uncharted territory, and people are waking up to the fact that they canât just do what their parents did and hope for a similar outcome.
In the post-financial crisis landscape, only the smartest will survive â that seems to be the attitude among those now buying their first properties, investing for the future and starting up businesses. Nearly three quarters of under-35s took advice on buying their first home, compared to fewer than half of over-55s â and thatâs bearing in mind that those under-35s had a whole internetâs worth of free information at their fingertips, and yet still felt the need to speak to an adviser in person.
Priorities are also changing. People now trying to buy first homes are already thinking about how hard â how much harder still â it might be for their own children and grandchildren. Nearly half of this generation (49 per cent) say they would like to help their dependents buy property when the time comes â something that their own parents arenât keen to do, with only 22 per cent of over-55s citing this as a priority. Are young people today more generous, more naÃ¯ve, or simply more realistic about future prospects? Probably a bit of all three.
It may be harder now to secure a financial future for oneâs family, but the up-and-coming generation is rising to the challenge. They can see how much has changed and are thinking harder about their decisions â and most importantly of all, theyâre not afraid to ask for help as often as they need it.
Advice can make a big difference whatever your age. Whether retirement is a long way off or just a few years away, talk to an adviser to see how they could help you. Find one here.