Generational gap in savings: How Brits plan their 2025 finances

A study conducted by Post Office has discovered that the top five financial resolutions this year are:

• Sticking to a realistic budget (28%)
• Saving money for more experiences with friends and family (28%)
• Building or enhancing an emergency fund (27%)
• Saving for a dream holiday (24%)
• Saving for home renovations (22%)

Generational differences

Realistic budgeting is a top priority for the 16-34 age group, with nearly two-fifths determined to sharpen their budgeting skills and take control of their finances. 94% of this age group reported having financial goals for the year, a stark contrast to just 61% of over 55s.

Interestingly, 17% of adults under 34 plan to save £10,000 in 2025 – 10% more than the over 55s. While young people are the most likely to feel inspired to save (40%), they are also the most likely cohort to feel stressed about putting money aside (20%).

The language of finance

The over 55s were more likely to favour traditional adages such as “watch the pennies, and the pounds will add up” and “a penny saved is a penny earned”.

However, new financial lingo is on the rise with younger generations – 22% of those aged 16-34 reported they have either heard of or use ‘#GirlMath’ (rationalising potentially irresponsible spending habits). 26% of this age group use modern saving techniques such as ‘Loud Budgeting’ (being honest when you talk about money) and ‘Soft Saving’ (not putting as much emphasis on saving for the future) to reach savings targets.

Financial advisor and influencer Mr MoneyJar said:

“I'm a huge fan of making positive savings goals; a view which is growing in popularity, as many more people are ‘saving for a sunny day’, meaning they’re saving for life’s pleasures. I am also a huge fan of the Loud Budgeting trend: providing a reasonable justification to others why you are making certain spending decisions. I want to see more of this in 2025, please!

“The wise old saying "watch the pennies and the pounds will add up" originates from right here in the UK! It emphasises the importance of starting small, and how small actions can lead to huge results. Over time, pennies saved will accumulate into pounds. You just have to make sure you save them somewhere – such as a good savings account! When planning your sunny year savings, it can be useful to think of saving as making a payment to your future self – using “a penny saved is a penny earned”, as every time you save money, ‘future you’ is indeed earning that amount.

“It's interesting that #GirlMath is still popular, having originally trended on social media in 2023 as an internet meme where women humorously justified their spending decisions - e.g. if you find leftover cash in your wallet and you use it to pay for an item, the item is essentially free. There is absolutely nothing wrong with spending money as long as it aligns with goals you’ve set for yourself. If it spills over into irresponsible spending decisions, this is perhaps best left in 2023.”

How Britain saves

When it comes to how Britain saves, the most popular method was automatic savings transfers, with 39% utilising this tool.

Newer, positive ways of saving are also gaining traction, with 1 in 5 (18%) having heard of or tried ‘saving for a sunny day’ – the act of saving money for enjoyment.

The research also revealed that 15% of people want to improve their financial literacy skills this year, with over two thirds (68%) believing it would have been beneficial to learn about savings at school.

Nearly one third (30%) feel inspired to save money in 2025, with 28% stating they feel more confident in saving money compared to a year ago.

Unsurprisingly, December is seen as the hardest month to save for 66% of people, followed by January (34%) which is often impacted by post-holiday expenses and New Year financial commitments. In contrast, March stands out as the easiest month to save for around one-third (31%).

When considering ways to save money, Mr MoneyJar added: “I recommend using the SMART method to reach financial savings goals and ensure your positive resolutions stick. This is an acronym that stands for Specific, Measurable, Achievable, Realistic, and Time-bound. If you want to achieve a savings goal, you’ll need to be Specific, by deciding what you’re saving for and the amount it will cost. Understanding "why" you’re saving will help keep you motivated. To make it Measurable, simply take your savings goal and divide it by the amount of months you have to save – that's how much you’ll put away each month.

“One of the best ways to make saving Achievable is to ‘Pay Yourself First.’ Set up an automated transfer into a separate ‘Sunny Day Savings’ account to reduce the risk of forgetting to save. Make sure your saving goals are Realistic for your circumstances by reviewing your personal circumstances. Finally, your goal needs to be time-bound. Note the goal you want to achieve your target in your calendar, set reminders, or write it on a post-it note for your fridge.”

Sean Morley, Head of Savings at Post Office said: “It’s great to see so many young people feeling inspired to save money, whether they do so via traditional savings routes or modern techniques such as ‘Loud Budgeting’.

“The way we save is constantly evolving – as evidenced by the fact that one in five have heard of or tried ‘saving for a sunny day’ as opposed to saving solely for emergencies. There isn’t a ‘one-size-fits-all’ approach to savings, and that’s why we offer a range of savings options at Post Office, helping people to achieve their dreams and meet their goals.

“If you are one of the many people (24%) saving for a holiday this year, you could be in with a chance to win a £5,000 dream holiday if you open a savings account with us in branch by 2nd March 2025. For more details on our weekly holiday prize draw please visit our website.”

For more information relating to the Savings weekly prize draw, please visit - https://postofficesaving.co.uk/holidayprizedraw