Virus crisis hits young workers’ savings

More than three-quarters of people in their 20s have had to dip into their savings in the past six months to cover day-to-day costs, a survey has found.

Some 78% of 20-somethings said they had used savings to cover everyday bills and expenses – as had 60% of people across all age groups, says research by investment management firm Fidelity International.

The majority spent this money on basic necessities, including food, household bills and supporting family members – with people spending an average of £843 from their savings over this six-month period.

Eve n w i th c o ro n av i r u s support measures in place, 8 1 % o f wo rke r s su r ve ye d who had been furloughed said they had needed to access their savings.

More than three-quarters – 77% – of those who remain furloughed continue to use their savings to support dayto-day spending, according to the survey of 3,000 people in October.

M a i k e C u r r i e , i nv e s t - ment director at Fidelity International, said: "Months of uncertainty have left many households with little choice but to rely upon their savings to cover the cost of daily essentials.

"The disruption caused to financial routines will not only have seen them forced to sacrifice savings goals, but caused stress and anxiety. For anyone in the position of having to rely upon their savings, it's important to review the overall financial position before making decisions."

While many have used savings to plug income gaps, the research found 26% of people have increased the amount they put into savings over the past six months, setting aside an average of £1,649.