Young adults ‘downsizing’ lifestyles as the cost of living rises

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Young adults are more likely than people over 55 to report “slimming down” their lifestyle or spending to cope with the cost of living crisis, research suggests.

About one in five (20.2%) under 35s do so, compared with 14.5% of those over 55, a survey of 2000 people in the UK found in September.

Young people are also about twice as likely as people over 55 to say they use credit cards to help them through the cost of living crisis and feel stressed about budgeting.

About one in seven (14.8%) under the age of 35 said they use credit cards to help, compared with about one in 14 (7.2%) over the age of 55, according to the Starling Bank survey.

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Nearly half (45.2%) of over-35s feel anxious or stressed about budgeting, compared to nearly a quarter (22.9%) of over-55s.

It is clear that young adults are trying to protect themselves by taking a proactive approach to money management through the sacrifices and financial choices they make.

More than a quarter of young adults (27%) postpone major purchases, such as renovating a car or home, and a similar percentage (26%) postpone vacations, the survey found.

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While most people are being affected by the cost of living crisis, the findings suggest it is more acute for younger people. Of the respondents who regularly set a personal budget, they usually go over £92 per month, compared to £108 for those under 35 and £64 for those over 55.

Starling Bank has launched a free online budget planner tool to help people identify and understand their monthly expenses.

Helen Bierton, chief banking officer at Starling Bank, said: “The cost of living crisis is forcing all of us to take a closer look at our personal and household finances, and it’s clear that young adults are trying to accommodate themselves by taking a proactive approach. money management through the sacrifices and financial choices they make.

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“But when it comes to budgeting, our research tells us that it’s the missing details in day-to-day expenses that often lead to unexpected costs that are harder to plan for.

“We’ve created a tool that can help identify all expenses to prevent expenses such as loved ones birthdays or insurance renewals from coming in as an unpleasant surprise.”

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