Over one in three 18 to 24-year-olds plan to spend more on insurance

A study commissioned by AXA UK has revealed that more than one in three (35%) 18 to 24-year-olds plan to spend more on insurance, compared to just 11% of 45 to 54-year-olds.The study revealed the nation’s overall spending priorities for the next 12 months amid economic uncertainty.Gen Z were found to already have more insurance coverage for their personal belongings than older age groups.

New research from AXA UK has revealed that Gen Z are restricting their spend in pubs and clubs and are instead spending more on insurance. 

AXA UK’s study, which surveyed 2,000 adults, revealed the nation’s spending priorities over the next 12 months amid growing economic uncertainty. It found that more than one in three (35%) 18 to 24-year-olds plan to spend more on insurance – compared to just 11% of 45 to 54-year-olds. 

This is reflected in the fact Gen Z were found to already have more insurance coverage for their personal belongings than older age groups. The younger generation are four times more likely to insure their jewellery compared to  55 to 64-year-olds (35% to 8% respectively) and twice as likely to insure their watch (26%) compared to the same age group.

It also emerged that 37% of 18 to 24-year-olds are set to spend more on experiences with family – compared to just one in ten 55 to 64-year-olds.

Among all age groups, eating out (31%), holidays and travel (27%) and clothes (22%) are the things people are looking to spend more money on.

Claudio Gienal, CEO at AXA UK and Ireland, commented:

“The cost-of-living crisis has understandably made many people nervous about what lies ahead. The Chancellor’s move to lower the basic rate of income tax from 20 per cent to 19 per cent, an increase in the threshold for paying National Insurance (NI) by £3,000 and fuel duty being slashed by 5p shows the government knows budgets are squeezed.

But despite this challenging climate, our research highlights the value we put on experiences with family and friends and the importance of spending time together. 

In these uncertain times, it’s also interesting that younger age groups are most likely to protect their goods via insurance and people generally plan to buy more insurance in the coming year. This suggests they don’t see insurance as a luxury but as a vital safety net which allows them to get on with their life and do the things they love.”

However, the UK’s nightlife sector may struggle, as just one in 10 plan to spend more money in pubs, clubs and on alcohol.

The study also found that when it comes to tightening the purse strings over the next 12 months, 24% of the nation plan to spend less on clothes, while others will cut back on eating out (19%) and buying electronics and gadgets (18%).

Many will also reduce their expenditure on jewellery (17%) and home improvements (16%). Almost one in four (24%) of Gen Z are planning to spend less on cars next year, while more than a quarter of 45 to 54-year-olds expect to curb their eating out habits. 

While 60% of men believe themselves to be careful shoppers compared to 53% of women, they spend more on impulse buys – £21 a week compared to £16.60 a week.

However, Gen Z spent more than any other age group on impulse buys (£28.80 per week) – compared to just £11.90 of those aged 55 to 64. 

The younger generation are planning to spend three times as much money on takeaway coffee than the over 55s.

“It’s fascinating to see how the nation is planning to spend its money in the coming months. An uncertain economic environment is creating a generational divide, meaning different age groups are prioritising different activities when it comes to their spending,” Claudio added.

“The lifting of coronavirus restrictions perhaps explains why more than a quarter of Brits are planning to spend more money on holidays and travel, despite rising inflation and economic uncertainty.”

Londoners splashed £30.30 on impulse buys, with Northern Ireland (£23.80) and the North East (£20.80) making up the top three regions.

The East Midlands (£13.20), the South West (£14.80) and the South East (£15.40) were the most frugal regions.

View AXA UK’S ‘The Priority Report’ in full 

Gen Z’s top spending priorities for the next 12 months

Takeaway coffee – 37%Insurance – 35%Clothes – 33%Eating out – 33%Cars and vehicles – 31%Electronics and gadgets – 30%Jewellery – 24%Nightlife socialising such as nightclubs, bars and pubs – 19%Home improvements – 18%Furniture – 16%

Research carried out by OnePoll on behalf of AXA UK between 11 to 14 March 2022, among a nationally representative poll of 2,001 UK adults.

Authored by AXA