Younger adults’ retirement saving and wealth accumulation in Britain a quantitative investigation

Recent developments in the pension landscape have resulted in an increased level of uncertainty for the younger generation’s retirement saving, the nature of which has consequently become more akin to wealth accumulation. Young adults are increasingly encouraged to save more for the future; however, not much is known about their approaches to retirement saving and wealth accumulation. This thesis aims to assess these approaches; it first focuses on the younger generation’s current economic autonomy in retirement saving and further expands it to investigate young adults’ wealth accumulation patterns. The thesis consists of four studies. The first study examines the role of human agency in retirement saving using structural equation modelling, and argues that individuals’ economic autonomy is closely linked to their socio-economic arrangements. The second study further investigates gender differences in retirement saving decision-making process using SEM multi-group analysis, and documents the negative impact of the male-breadwinner income model on women’s financial resilience. The third study examines the role of financial support from family in young adults’ homeownership in discrete-time event history analysis. The results point to a substantial amount of both direct help (money) and indirect assistance (co-residence). The last study assesses wealth accumulation patterns by establishing four saver types using factor mixture modelling. Transition between the saver types over time is analysed using latent transition analysis. The results show that, while the transitions between saver types over time are mostly stable, more upwards movement is observed for individuals from a higher socio-economic background. This thesis provides evidence on how young adult’s ability to manage uncertainty and organise their lives is influenced by socio-economic arrangements. In particular, it documents the increasing role of family background and the effects of systematic (dis)advantage among young adults. These findings point to a need for coordination of a wide range of policies that alleviate economic insecurity in the short- and mid-term in order for the younger generation to plan for the long-term future with autonomy

Can't save or won't save: financial resilience and discretionary retirement saving among British adults in their thirties and forties

This study examines retirement saving activity outside the state and workplace pension saving schemes among British adults aged between 30 and 49 on the premise that individuals are increasingly encouraged to save for their retirement in the new pension policy structure in Britain. The issue of under-saving among the younger adults has been studied with the focus on internal characteristics, such as undesirable attitudinal or behavioural tendencies (‘won't save’), or on external factors, such as income (‘can't save’). Building on these discussions, this study tests the role of internal characteristics and further examines the interplay between internal and external factors. The decision-making process for retirement saving is mapped based on the Model of Financial Planning with minor modifications. The analysis utilises the fourth wave of the Wealth and Assets Survey (2012/2014), and is conducted in the structural equation modelling framework. Results show that younger adults’ discretionary retirement saving is an outcome of a complex interplay between internal and external factors. Financial resilience, which indicates current financial behaviours and wellbeing, is found to be the strongest predictor for identifying a discretionary retirement saver, but it is closely connected to individuals’ income and home-ownership. The findings also suggest that social and economic arrangements are important to consider as social ageing, individuals’ projection on their lifestages, may be more informative than age per se for understanding younger adults’ retirement saving behaviour. These findings have important implications for the policies that aim to increase retirement saving participation

The social, cultural and economic influences on retirement saving for young adults in the UK

How young adults in the UK save for their retirement has become more complex due to recent changes to the pension policy, which necessitate greater and continuous private saving (through workplace pension schemes and other savings vehicles). As the importance of active saving during working life grows, it becomes essential to understand young adults’ retirement saving behaviour. In this chapter, we focus on the younger half of the working age population in the UK (adults aged up to 50, hereafter young adults) to fully capture the experiences of becoming an adult in the first part of t working life and how this shapes financial behaviours, acknowledging that patterns of ageing vary across different groups (Baars et al., 2013; Mortimer & Moen, 2016). Our work suggests that young British adults’ approach to retirement saving is not simply a function of income (or the lack of it), or present bias/myopia, but instead concerns how social and economic circumstances coalesce. By combining the findings from two studies on the young adults’ retirement saving, using quantitative and qualitative data, we provide a nuanced picture of how young adults’ social, cultural and economic factors inform retirement saving. Drawing on a social ageing perspective, meaning the ways in which individuals perceive their life-course progression, we demonstrate that young people’s retirement saving is contingent on feeling financially resilient and established in their adult lives, guided by economic, social and cultural norms. We argue that this social ageing perspective is essential to understanding retirement saving activity amongst young adults, and highlight theoretical, methodological and policy implications

No place like an accessible home: quality of life and opportunity for disabled people with accessible housing needs

Habinteg Housing and Papworth Trust commissioned CASE at LSE to report, primarily in relation to working age disabled people, on: 1. The extent of need for housing which has accessible features (for example a stair lift), and the impact on disabled people of living in a home where their need for such a feature is not met. These impacts include economic impacts such as working patterns, income, assets, as well as impacts on wider quality of life. 2. More specifically, how far unmet need for accessibility features, or lack of access to suitable housing options, is associated with disabled people not being in work. 3. The impact of the above factors on housing choices, including what proportion of households containing a disabled person are currently, or might be in a position to become, owner-occupiers. We were also asked to advise on potential changes to data collected for large scale surveys which might enable them to become a more useful source of information for policy-makers, developers and advocacy groups. This report is part of a programme of research commissioned by Papworth Trust and Habinteg Housing. Ipsos MORI conducted opinion research on public attitudes, and further work is being done by the Institute of Public Care at Oxford Brookes University around improving information about households containing disabled people for developers of housing and council planners

Young British adults’ homeownership circumstances and the role of intergenerational transfers

Despite the continuing preference for homeownership, it has become increasingly difficult for young adults to own a home in Britain. House prices have increased faster than real earnings between the mid-1990s and the 2010s, resulting in significantly deteriorated affordability. Mortgage products have also become less accessible, as a large deposit has been required to secure the loan after the financial crisis of 2008/09. Previous studies point to the increasing role of intergenerational transfers in filling this gap. Some young adults obtain help from family to become homeowners, either receiving monetary support or by saving through living at the parental home. Using the Wealth and Assets Survey, this study attempts to examine the effect of these two types of family financial support on young adults’ homeownership circumstances, and controlling for other characteristics such as parental homeownership. First, it examines the characteristics of homeowners among young adults cross-sectionally using logistic regression. Second, by focusing on the non-homeowner subsample it analyses the effect of direct (money) and indirect (co-residence) family support on young adults’ entry to homeownership in the six-year period using discrete-time event history analysis. The results show that chances of young adults’ homeownership between 2008/10 and 2014/16 are very much tied to family support. The odds of becoming homeowners who have received direct or indirect support are found to be three times higher, even after accounting for other characteristics

99 luxury apartments for the 1%

In this photograph, a housing building is being demolished. The new building will have 99 luxury apartments, mainly targeting relatively well-off individuals. How many of the tenants who used to live in the old building can move into this new luxury apartments? The great London demolition of affordable housing

A critical review of cost-effectiveness research in children’s social care: what have we learnt so far?

This article presents the findings from a critical review of cost-effectiveness research in children's social care. With a focus on the past 20 years (since 2000), the review aims to assess the use and consistency of definitions relevant to evaluating cost-effectiveness such as financial input (costs) and outcomes, and to review and summarise learnings from cost-effectiveness studies in the English children's social care system. We included both academic and grey literature and identified 61 relevant publications for inclusion. The results are organised according to three themes: costs, outcomes and cost-effectiveness. We identified that a large proportion of studies contained a discussion on cost, spend or unit cost, and an equal proportion of articles concerned outcomes of service, benefit to children or quality of service provided. The number of studies discussing cost-effectiveness, cost–benefit or economic evaluation was considerably smaller. The findings highlight substantial gaps in the literature, with a disproportionate focus on stating the problem in terms of cost pressures, and very little robust evidence about cost-effectiveness. Furthermore, the article sets out methodological limitations and indicates a lack of transparency in many of the report studies. We conclude that as a result of the gaps and limitations it is difficult for policymakers and other stakeholders in children's services to make evidence-informed decisions about the best use of their limited resources

Exploring local authority variation in looked after young people’s subjective well-being

There has been growing interest in the Local Authority (LA) variation in rates of admission to care and provision of services but less is known about whether young people’s experience of care varies by LA. Using survey data from 4,994 looked after young people (aged eleven to eighteen years) from thirty-six English LAs, the analyses focused on LA variation in their subjective well-being. There was a statistically small LA variation in young people’s responses to individual survey questions except for a question that asked if young people felt they had a trusted adult in their lives. Between 66 per cent and 100 per cent of young people had a trusted adult depending on the LA caring for them. Positively associated with overall well-being were, being looked after by a non-London LA, a longer length of time in care, fewer placement moves, children’s positive perceptions of a reciprocal trusting relationship with their carer, having a good friend and being male. Counter-intuitively, LAs with an outstanding or good Ofsted social care or education judgement were associated with a higher proportion of their young people having low well-being