Waiting for their happy ever after: 6.5 million put off managing money

The way we build families in the UK is changing. Millions of people are delaying key life events like getting married, having kids or buying a home. For many, some of these milestones aren’t part of their family plans at all, and this is having an impact on their financial wellbeing, according to new research from Legal & General¹.

UK families are reaching key milestones later

An estimated 6.5 million UK adults (12%) are waiting until they are married, become parents, or own a home to get key financial products. However, social changes have seen these milestones increasingly delayed, and Legal & General caution that it could hurt the UK’s financial wellbeing.

Analysis of official records found that the average age at which UK adults have their first child is the highest since records began, now at 32 years old. Meanwhile, the average age for a person to buy their first home is up to 34, the highest in decades. People in the UK are also getting married later, with women on average getting married at 33 and men at 35, this has increased steadily over the last few decades up from an average of 29 and 32 respectively in the year 2000.

Financial resilience threatened by delays

Legal & General found that key life milestones are typically when families start to take their finances more seriously, saving more, planning retirement or taking out protection.

Two out of five UK adults who have not started a family yet (21%) said this was a factor in putting off key financial decisions. This includes:

• taking out protection insurance (22%)
• starting to save into a pension (23%), and
• putting money into savings (18%).

11% of people were putting off making these decisions until they got married and 17% were waiting until they purchased their own home.

With key life milestones delayed, financial engagement in the UK is also in decline. 35.7 million adults are classed as financially disengaged, meaning they do not check in with their finances regularly.

The delays could have a huge impact on financial wellbeing. The lack of people taking out protection insurance could leave millions of families without a safety net; based on Legal & General’s most recent data, half of all critical illness claims took place before the age of 50. And, putting off pension saving will be contributing to the fact that millions of young people are on track to enter retirement with an annual shortfall of more than £25k by the 2060s².

Modern families need modern support

The make-up of families is also evolving. Which in turn can have an impact on how people manage their money.

One in four UK family households are now blended families (23%), where two adults with children from previous relationships come together and mix their families. This can sometimes complicate family finances as people are more likely to co-parent with people outside their home.

Three in five families who do not have children (60%) are never planning to have them. This means they are less likely to take up products such as life insurance or critical illness cover, as having children often leads people to consider this.

References:

¹Mustard research consisting of a nationally representative survey of 2000 UK adults conducted in January 2024.

²Analysis conducted by Legal & General based on Opinium Research conducted amongst 2,000 online interviews of people aged 22-32 in August 2023. Income based on Legal & General annuities.

³Financial Lives 2022, July 2023, FCA.