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Young people to be poorer than parents


Young people may be poorer than their parents at every step of their lives, according to a new report from the Institute of Fiscal Studies (IFS).

The report showed that the slow rate of growth and the increase in pension values means that young people are set to lag behind earlier generations in wealth terms.

The study also looked at peoples attitudes to saving and pensions, and the reasons behind why savings were varied, from saving for holidays and leisure, to unplanned expenses and a retirement income.

In regards to attitudes about pensions, in households aged 25-34, nearly one-quarter claimed that they did not expect to receive any income from the state pension in retirement, but one third expects it to be their largest source of income after retirement. Despite the introduction of auto-enrolment, requiring all business to enrol their employees onto pension scheme, nearly half of people in this age bracket did not expect to receive any money from a private pension.

Dave Innes, a research economist at the IFS and an author of the report said:
"Despite the financial crisis, household wealth on average increased in real terms over the late 2000s, driven by increases in private pension entitlements.
"Even with these increases in average wealth, working-age households are at risk of being less wealthy at each age than those born a decade earlier."

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