Foundation generation are taking on the tough times as they lay the groundwork for healthier long-term saving

Article date: 26 November 2011

  • UK’s foundation generation (25-35 year olds) are savvy and serious about managing their money
  • Going up: balancing the daily spend with saving for the future, home owning and paying off debt
  • Up to 50% say they have a pension (workplace or private personal pension)
  • Going down: holidays and hobbies don’t rate among the top financial goals
  • "Keeping up with the Jones" is a thing of the past. 

Britain’s 25-35 year olds are defying the challenging economic times as they plan their finances for today and show a determination to save for the long-term, Aviva research shows.

The findings from the research paint a picture of a financially aware generation that is taking stock of their financial situation in today’s challenging economic environment. This foundation generation of 25-35 year olds, so called because they are laying the groundwork for their financial future, are also developing their careers, managing their debt and budgeting their day to day spend.

The typical monthly take-home income* for the foundation generation is £1,144 providing a steady income from which to manage their finances. Net income starts at £1,055 as people enter their mid to late 20s and rises to £1,246 as they hit their early 30s.

Financially responsible:
Money is being used wisely with 89% of the foundation generation holding a savings account, 38% having some form of workplace pension, 12% having a private personal pension, 41% investing in a cash ISA and 34% receiving protection from life insurance.

The main reasons people in this age group don’t pay into a pension provided via their employer is that they either cannot afford to pay into it (20%) or they work for an employer which does not offer one (19%).  

Employers supporting saving:
When asked about their preferences in the next five years for saving for retirement, 26% said they would prefer to save into a workplace pension, 22% into a private personal pension, and 18% through a savings option other than a pension, such as property. Asked specifically about how their employer could help them make the most of their finances, 18% said they wanted a range of benefits they could choose from. 

Long-term goals:
While some of the foundation generation’s current financial goals focused on short–term issues such as saving for a holiday (8%) or to fund their hobbies/interests (13%), far more people are looking to the future. Over a third (36%) are saving to buy a house, 34% are aiming to pay off their debts and 20% are looking to pay off their existing mortgage as quickly as possible. In addition, 22% are saving for the future generally. 

Managing their concerns:
While this generation has taken an active and positive approach to financial planning, they also acknowledge the difficult environment in which they are establishing their careers. The majority (89%) have been financially affected by the current economic circumstances with 29% being more careful about what they spend, 13% saying they found it harder to make ends meet and one in 10 worrying about their finances more than before.    

The biggest single current worry for this group was meeting an unexpected expense (23%) and making ends meet each month (19%). This far outstripped those people who are worried about keeping up with their friends financially (1%). Not surprisingly, with high unemployment 13% named losing their job and prolonged unemployment as a key long-term financial concern.

Careful budgeting:
Encouragingly the foundation generation demonstrate a resourcefulness in managing their money, as they look for best buys or deals (40%), watch what they spend (40%) and work towards their long-term financial goals (32%).           

Aviva’s director of workplace savings Paul Goodwin said: “With so much concern about people not saving enough for their retirement, it’s really good that this younger group of men and women seem to be actively managing their finances and planning for their future. This generation has the ability to make a real difference to their standard of living right up to and through retirement, if they put money aside now for the long-term.

“While there is a natural tendency to think that the younger generation will put off saving for retirement to fund their lifestyle now, this research shows that they do actively want to balance their spending with long-term saving. What we need to see is that this desire to save translates into more people actively putting money aside for the future as soon as they start their working lives.

“With automatic enrolment starting next year, every employee will have the opportunity to actively save for the long-term through a workplace scheme. Continuing to explain the range of benefits available in the workplace will ensure that employees don’t opt out, and make the choice to put money aside for the future.”


If you are a journalist and would like further information, please contact:

Aviva press office:
Diane Mangan
Telephone: 01904 684164 / 07800 691714

Fiona Robertson
Telephone: 01904 452659 / 07800 692299

The Wriglesworth Consultancy:
Lee Blackwell / Emma Beresford
Telephone: 020 7427 1400

Notes to editors:

* This statistic differs from those provided by ONS as they track the employed rather than all those between 25 and 35.

Data was sourced from over 2,200 people as part of a UK representative sample interviewed using Wriglesworth Research, which is registered with the ICO. 

About Aviva
Aviva is the world’s sixth largest* insurance group.  We provide 44.5 million customers with insurance, savings and investment products with total worldwide sales in 2010 of £47.1 billion**.

We are the UK’s largest insurer with over 14 million customers. Our combination of life, health and general insurance is unique in its scale and breadth in the UK market.  Customers can choose to buy our products through intermediaries, our corporate partners or from Aviva direct and we have become the partner of choice for many of the UK’s biggest organisations.                   

We are ranked as one of the UK’s top 10 most valuable brands and Aviva plc are in the top 10% of socially responsible companies globally in the Dow Jones Sustainability World Index. In 2010 we invested £4.3 million into our communities in the UK, which included 1,500 Aviva volunteers giving 24,000 hours for good causes. In addition, our employees gave £600,000 through fundraising and donating. Read our corporate responsibility report at

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* based on gross worldwide premiums at 31 December 2010.
** at 31 December 2010.

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