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Study Reveals Generational Shift in UK Spending Habits

Young people in the UK have become “credit-averse”, according to a major study of shopping and spending habits conducted by YouGov. Instead, they are increasingly hungry for innovations which offer more convenience and avoid debt. 

The research, entitled “UK Millennials, Shopping and Money” and commissioned by Clearpay, revealed that young people are far less comfortable with debt than older generations, strongly prefer to pay by debit for almost every type of product and want more innovation in both shopping and financial services. 

Millennials are the most valuable consumers, expected to represent 35% of the global workforce by 2020. YouGov notes there are currently 13 million UK millennials, representing a fifth of the population. According to the research, a third already use digital wallets, barely half even own a credit card, and of those without, 93% said they don’t even want one. 

“In the UK young people in particular are looking for new ways to budget and make purchases without falling into debt.” 

This is a profound generational shift in attitudes to debt which YouGov says may in part be explained by the rise in student debt. The report notes that since the UK government tripled the cost of further education in 2015, increasing numbers of young people have student loans. Among current and former students (aged 18-24) 76% have debt, against 56% of under 35’s. 

The research also found significant generational differences in how people choose to pay. Whilst YouGov found that people of all ages make similar use of debit cards and PayPal accounts, Milliennials are significantly less likely even to own a credit card than the 35-55’s (Gen X) – at 51% against 71%. 

“These findings support similar research we’ve done in the US and Australia where, if anything, young people are even less likely to own a credit card than in the UK,” said Carl Scheible, CEO of Clearpay. “The financial crash left scars on all generations and traditional banks and credit providers lost trust. In the UK young people in particular are looking for new ways to budget and make purchases without falling into debt.” 

Key findings of the research by YouGov, detailed in the report, also include: 

Online shopping makes life easier for consumers of all ages (75% of Millennials and 70% of Gen X) 

Fashion, clothing and accessories is the biggest spend for Milliennials after going out; on average young people spend half their monthly discretionary income on clothes. 

Young people strongly prefer to buy clothes and accessories online, with 60% having done so in the past six months – with Amazon being the most popular online retailer. 

Debit cards are the preferred way to pay for all products by UK Millennials, with credit cards only coming close on the priciest purchases, over £500. 

Half of Britons aged 18-55 are currently in debt, with 56% of Millennials being in student debt (against just 11% of 35-55’s) 

9 in 10 Millennials say they actively manage their money and 53% see themselves as savers rather than spenders (which compares with 35% of Gen X) 

Young people are more interested in new payment methods than traditional credit – the report notes, for instance, that a third of UK Millennials are already using digital wallets, against 23% of Gen X. 


  • Editorial Director of the The Fintech Times

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