• Tue. Sep 28th, 2021

Average 20-something earns £22,600 a year – and has over £300 disposable income a month

Jul 29, 2021

We use your sign-up to provide content in ways you’ve consented to and to improve our understanding of you. This may include adverts from us and 3rd parties based on our understanding. You can unsubscribe at any time. More info

Of those polled, those in Liverpool earned the most on average at £27,716, and also had the most disposable income at £423 a month. The research also found an increase in money confidence among young people, with more than two thirds (68 percent) feeling the pandemic has made them more responsible with their disposable income.

The past 18 months have made a big impact on the way young people spend and save

Chris Pitt, first direct CEO

Chris Pitt, CEO of first direct which conducted the study, said: “Our research revealed the past 18 months have made a big impact on the way young people spend and save.

“In terms of average salaries and the cost of living, there are some clear differences among young people in different parts of the UK, but overall we found some sense of money confidence among this age group with many choosing to act carefully with their money.

“This is highlighted in particular by the suggestion that if given a pay rise, more would look to increase their savings or pay off existing debts before looking to spend their earnings on new clothes or gadgets.”

The high level of earnings in Liverpool could partly be attributed to the fact that the region had the fastest economic growth in England pre-Covid.

People in London had the second-highest earnings (£25,524), followed by Edinburgh (£25,365) and Manchester (£23,402).

Those in Newcastle had the second highest disposable income at £403, followed by Edinburgh (£374), and Bristol (£340).

However, those living in Cambridge are least likely to splash the cash on unnecessary items, with residents spending just under £270 a year on things they don’t need, compared to a UK average of £520.

And when it came to paying for their rent or mortgage, respondents in London are typically paying the most at an average of £732 per month, while those in Glasgow were paying the least (£420).

As well as feeling more responsible with their disposable income because of the pandemic, the research also reveals if respondents had a pay rise, over half (52 percent) would still live the same way and put the money into their savings.

Meanwhile one in five (20 percent) would pay off debts, and 17 percent would start treating themselves more.

It was found that under 30s living in Edinburgh and Plymouth (61 percent) would be most likely to put their extra money into savings, while those in Bristol would most likely treat themselves (19 percent).

Overall those polled had an average of £3,599 in cash savings, with Londoners having saved the most (£4,118) and those living in Manchester the least (£2,643).

Young people are also looking into the distant future in terms of money, with the average under 30 paying £144.80 into their pension each month.

Those in Edinburgh are paying the most each month (£184), which is almost twice as much as those in Plymouth (£95).

It also emerged six in 10 respondents (59 percent) have taken out an investment, with 23 percent opting for stocks and shares.

Mr Pitt added: “Whether it’s growing their pension pot, adding to their savings or trying to increase their wealth through investments, the pandemic has seen young people across the UK focus on building themselves a more financially-robust future, which is really pleasing to see.”

Source: Read Full Article