More than a third (38%) of Brits are preparing a reserve savings pot in anticipation of another crisis, a study has found.
Over two-thirds (68%) of people believe they will witness a lockdown again, encouraging people to put away emergency savings just in case, according to a survey of over 2,000 UK adults by new bank Zopa.
A fifth (20%) of respondents said the coronavirus pandemic had been a financial wakeup call, with almost a third (30%) admitting they were financially unprepared for the situation.
Millennials are making the greatest changes to their savings habits in the wake of COVID-19 with 50% of 24- to 39-year-olds starting to save money now for unexpected events compared with 23% of those aged over 55.
Longer term, millennials also plan to save the most — aiming to have an average of £21,567 by 2025, compared with £18,953 saved by those aged over-55 and a national average of £20,676.
Millennials have been financially hit by the coronavirus pandemic more than older age groups, with more than seven in 10 (72%) saying they had felt some kind of economic impact, according to a separate survey by credit checking company TransUnion.
Half (51%) of Brits admitted they are financially worse off since the pandemic, Zopa found.
A fifth (20%) said they are also saving now due to the anticipation that prices will rise later this year and into 2021. Topping the list of items consumers expect to see increase in price are flights (56%), holidays (53%) and eating out (53%). Some 16% also want to save extra this year so they can go on bigger holidays in 2021, making up for missing out in 2020.
As consumers evaluate their spending, it seems that the pandemic has driven a more community based and socially responsible attitude to spending, with 62% willing to spend a little more at independent businesses post-coronavirus, if it helps small firms get back on their feet. The average person would spend £1.40 more on a pint of beer and £1.60 more on a coffee at an independent business, if it would help the business to survive.
Clare Gambardella, Zopa’s chief customer officer, said: “The last few months have really put the nation’s finances under a microscope and forced many people to re-look at how they save and spend. Encouragingly, we can see that where possible, people are using this time to put in place good financial habits — particularly the younger millennial audience, which might surprise some.”