A combination of challenging situations are bringing high pressure on young people aiming to manage their money well and achieve financial wellbeing, according to the November 2019 Money Statistics, produced by The Money Charity.The November report draws a number of statistics related to young people together into one page, giving a clearer cumulative picture of the difficulties young people face when trying to establish a financially secure and stable future.
At the end of September 2019, there were 5.5 million people aged 18 to 24. Of these, 1.9 million were in full-time education and 3.4 million were in employment. With a minimum wage rate of £4.35 an hour for Under 18s (or £3.90 for apprentices), increasing to £8.21 rate for over 25s, median weekly pay for 16-17-year olds working full-time in April 2019 was £201.20, £350 for 18-21-year olds, and £494.60 for 22-29-year olds. Across the UK, the median weekly pay for total employees of all ages working full-time was £585. Further issues can be seen in disparities between male and female pay, with the female median pay around £14 per week less than the male median for those aged 18-21, while for 22-29s, female pay was around £32 per week less.
Students in 2018-19 could expect to receive an average combined maintenance and tuition loan of £14,463 in England, £10,226 in Wales and £8,335 in Northern Ireland. These levels are leading to a total student debt for the latest cohort to enter repayment of £35,950 in England, £22,920 in Wales, £23,550 in Northern Ireland and £13,800 in Scotland.
The median monthly rent in England for a single room with shared facilities was £390, going up to £600 within London. The average price paid by first-time house buyers in September 2019 was £197,433, requiring a deposit of around £51,000.
That means that from their relatively low earnings, young people have a considerable quadruple challenge: paying the rent, servicing their student debt, saving for a deposit on a house/flat, and simply managing the financial essentials of the day-to-day.
Erik Porter, Acting Chief Executive of The Money Charity said “The financial pressures young people face, from low wages to high rents and even higher house prices, are considerable. When you add onto those a default position of starting adult life with large debt, for those who wish to pursue further education for their future prospects, it’s hard to see how we are giving young people the chance to achieve their financial goals.”
“We might not be able to change prices or wages, but we can continue to work hard every day delivering our Money Workshops, offering great resources, and advocating for improvements in the financial education young people receive right across the UK. Helping young people develop the skills, knowledge, attitude and behaviours needed to manage money well will give them the best available preparation for facing these challenging situations through the rest of their life.”