Younger generations are feeling increasingly anxious about the deepening economic and cost-of-living crisis and avoid looking at their finances, according to the latest research.
Aviva’s Age of Ambiguity study reveals that 60% of Generation Z and millennials – those aged 18–41 – feel that finances “are often out of [their] control”. The research tracks employees’ changing experiences of the modern workplace since early 2020, before the COVID-19 pandemic struck, and shows that financial avoidance is playing out against a backdrop of persistent anxiety for many working people; 27% employees in the UK’s largest businesses of 1,000 or more staff feel very anxious from day to day. This figure is higher than during the second half of 2020, when 22% of people felt the same.
Across businesses of all sizes, Generation Z and millennials report the highest level of financial anxiety, at 69% and 73% respectively – leading them to avoid looking at money matters for fear of what they will find. This is considerably higher than the figures for older cohorts: around half of Generation X – those aged 42–57 – and 36% of baby boomers feel anxious when dealing with their finances.
However, with predictions that the pandemic and cost-of-living crisis will disproportionately affect younger generations in the future, many parents and grandparents – who may recall the double-digit inflation of the 1980s – now worry about younger family members as well as themselves. Nearly half of working parents (49%) say their top concern is their children’s financial future.
“It is a difficult time for many, with some demographics feeling the cost-of-living crisis more acutely than others,” said Aviva’s director of workplace savings and retirement Emma Douglas. “Our research has shown that younger workers are most likely to be avoiding engaging with their finances due to feelings of anxiety and a lack of financial resilience. However, despite it being a daunting prospect, engaging now is the best course of action.”