Marvin OnumonuSix in ten millennials in the UK are struggling to save for retirement, with current life stages impacting their financial plans.
Phoenix Group’s research found that 59% of millennials, compared to 48% of Gen Z and 39% of Gen X, are facing difficulties.
A quarter of those surveyed cited changes in income as the main issue, while 24% pointed to childcare responsibilities, which millennials are twice as likely to mention than any other age group.
Life events such as parental leave, childcare commitments, home buying, and career changes are affecting savings for this generation. Women are overly impacted due to increased childcare and caring responsibilities.
Previous research from Phoenix highlighted that savings between men and women diverge significantly from ages 25 to 34, leading to men saving 50% more than women by ages 45 to 54.
The research found that only 20% of millennials view pension contributions as a priority, with short-term financial pressures taking precedence. Some have decreased (7%) or stopped (7%) their pension contributions over the past year.
Patrick Thomson, head of research analysis and policy at Phoenix, said: “As a millennial myself, I know first-hand the pressures many at this stage face weighing up competing priorities that pull us in different directions.
“This can lead to day-to-day essentials, such as housing or childcare costs, being prioritised over longer-term savings goals.
“There is a risk that if people don’t readjust their savings once they have got through a short-term financial challenge they will reach retirement with much less than they’d hoped for.
“Employers also play a vital role in supporting their staff to maintain retirement saving at key life stages, including continuing employer contributions during parental leave.”
