Monday, 27 November 2017 14:46

Millennials wouldn't be able to pay a surprise bill of £200

If your car was to break down tomorrow, could you pay for the repairs to be done immediately? If the answer to this question is no, you’re not alone. According to research from credit firm Experian, over fifty per cent of people under the age of 36 wouldn’t be able to pay an unexpected bill of around £200.

You’d be forgiven for thinking that this number reflected those people that were on poor incomes – but you’d be wrong. The information that we’ve seen shows that these are people on decent incomes that still wouldn’t be able to stump up the cash in an emergency. The research suggests that nearly 90 per cent of people who were classed as earning a ‘good’ income would still have difficulty finding this cash at short notice. These people also have no savings, and probably never will.

It appears that no-one has a stable financial outlook anymore. In fact, the majority of youngsters in this country, or millennials as they are now affectionately known, are ravaged with debt and have no savings to support them. Their only outlet is to slap everything on the credit cards, or, go running back to parents and even grandparents for support.

This is all a culmination of the plastic spending culture that is engulfing us at the moment. We live in a ‘celebrity obsessed’ time where all people care about is splashing the cash to keep up with trends. The credit card is everyone’s best friend. People use it to fund their holidays, their car purchases and basically need it to pay for essentials. It makes you wonder how people survived without the plastic fantastic.

Behaviours and attitudes need to change and quite drastically. We’ve said it time and time again; we can’t keep borrowing like there’s no tomorrow.  Responsibility is something that people need to have and the old adage ‘if you can’t afford it, you can’t have it’ needs to come back to the fore.

We completely accept and understand that the cost of living has never been so high and that people in their 30s still struggling to get on the housing ladder in the neighbourhoods in which they grew up, is an outrage. This said, however, this very same group of people should not be splurging on credit cards when they should be saving up for house deposits and setting up a home for themselves.

It may not be surprising to learn that the older generation amongst us – the grandparents in their 70’s - hardly have any debt and almost two thirds are completely debt free.

Of course, it also may come as no surprise to hear that London is the hotspot for credit card debt and is home to the most people who have absolutely no savings and live off the plastic. Wherever there is a young demographic, there will be numbers associated with debt. London and student cities all have high levels of credit card debt for example.

The outlook doesn’t look like it is about to get better anytime soon either. Rising inflation and wages stuck on the same level will not be helping matters so it is all about changes to behaviour that we have to rely on to make some kind of difference.

As a generation, changes need to be made to spending habits. If the money isn’t there to pay for essentials like water and gas and cars to get us to work and back then we really shouldn’t be spending a penny on anything like luxuries. New clothing and socialising should be at a minimum. People feel very hard done to these days and believe that if they work they should be allowed to go out, have a good time and buy whatever they want.

That’s fine and in an ideal world that is what should happen, but when the very same people then go for bailouts to their parents because they can’t afford to fix the car and/or they need help towards saving for a deposit, that is when it becomes a little bit of a mickey take.

It’s hard out there, yes, but financial responsibility needs to happen. Parents cannot keep bailing their children out.

We’ve done loads of articles highlighting the importance of budgeting and we can not reiterate more the importance of what great things good money management can bring. So get your finances in check, don’t spend what you haven’t got and always, always be frugal.

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