£175 to be paid into bank accounts of people born between these dates
Around 1.4 million young adults are missing out on around £175 in free cash because they are not making the best use of their savings. People who are Gen Z - born between 1997 and 2012 - have been told they could easily make more money by shopping around for the best savings accounts.
They are classed as 'inactive savers' because they stick with the same account, rather than looking around for better interest rates. On average Gen Z put away £292 each month in savings or £3,504 a year, according to Yorkshire Building Society.
If this was put into a savings account with a 5% interest rate instead, they would make £175 in interest over a year. Chris Irwin, director of savings at Yorkshire Building Society, said: “Despite a willingness to spend time looking after their finances, it is clear from this data that many young people are missing out when it comes to their savings.
READ MORE: Automatic £300 payment for people born before this date
Get our best money saving tips and hacks by signing up to our newsletter
“Many also said they lack confidence to make important financial decisions, leading to large pockets of people who are missing out on significant savings interest. If we support and encourage these young adults to shop around now they could be getting a lot more back for their money, now and through their lifetimes.
"Keeping large amounts of funds in low paying current accounts has become a costly mistake for millions. It’s understandable to want to have money accessible for emergencies or even topping up everyday expenses, but with so many instant access savings accounts currently available in the market paying a much higher return, there has never been a better time to review the home of your savings."
Rachel Springall, finance expert at Moneyfactscompare.co.uk, said: “The past few years have been unprecedented, so it’s understandable to see the struggles of young people unable to save amid living costs. Everyone will have their own priorities in life, so making time to set up and monitor a dedicated savings pot can get overlooked.
“If someone has their cash stashed in a low paying current account, they could be better off using an instant access savings account and have the same flexibility. Saving little and often is the key to start building a nest egg, and it all adds up over time.”