New research reveals a growing trend in the way consumers approach saving, with younger people opting to spend on present-day comfort rather than saving for the future.
This shift, identified in a study by credit-building company Loqbox during National Savings Week, has potential implications for retailers across the UK.
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Younger shoppers focus on immediate needs
The study, which surveyed 1,000 UK residents, highlights the rise of ‘soft saving,’ where individuals save with the intention of improving their current lifestyle instead of focusing on long-term financial security.
This trend is particularly noticeable among younger generations, with many prioritising buying homes, holidays, and vehicles over traditional savings goals such as retirement planning.
For retailers, this could suggest a growing demand for products and services that provide immediate value.
Younger consumers between the ages of 18 and 24 are more focused on purchasing homes and cars, and are more likely to allocate funds towards holidays.
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By GlobalDataRetailers in sectors such as travel, automotive, and housing-related goods may see increased demand as a result.
Women and men show different financial priorities
The research also found that financial priorities differ by gender, with women more likely to focus on building emergency funds and paying off debt while men are more inclined to save for vehicles or retirement.
Women are also more likely to cut back on nonessential spending and focus on budgeting, which may influence their shopping habits.
For retailers, understanding these differences could be crucial in tailoring product offerings or marketing strategies to better appeal to different demographics.
Retailers may benefit from targeting women with promotions that highlight the importance of budgeting and financial planning while offering products that align with men’s long-term goals like retirement and investment.
Long-term trends and retail opportunities
While younger consumers prioritise immediate comfort, the research shows that buying a home remains a key long-term goal for many.
For those aged 18 to 34, homeownership is a priority while those over 45 focus on retirement planning.
As this group moves towards larger purchases such as homes, retailers specialising in home improvement, furniture, and home appliances could see increased interest.
At the same time, there are indications that some consumers are becoming more conscious of their savings and financial health. The study highlights that women are more likely to set aside money monthly while men are more inclined to invest.
Retailers who offer flexible payment plans or promote financial wellness products may find opportunities to engage with this segment.
As the economic landscape continues to evolve, the insights from this research offer retailers a clearer view of shifting consumer priorities and potential strategies to adapt to changing spending habits.
