Average monthly income gap over £400
by Gill Montia
Story link: Average monthly income gap over £400
Britons face an income gap of £411 per month between their current net income and what they believe would allow for a comfortable life, according to new research from Aviva.
The insurer’s latest “Times of our Lives” report puts the perceived shortfall at £7,236 per year gross, although the 25 to 34 age group felt in need of an extra £627 per month net, equivalent to an annual gross increase of £12,003.
For 35 to 44 year-olds, £596 extra per month (£10,762 per year) would sort the household budget and Aviva points out that people in this “squeezed middle” group often have to balance high levels of debt with a young family, increasing the financial pressures faced.
Notably, when asked about their worries, “squeezed middle” respondents were more concerned than others about making ends meet and meeting unexpected costs.
Meanwhile, the over 65s were looking for just £23 per month extra, both wealth and contentedness having increased in older age.
According to the study, net household wealth grows steadily through life, rising to £308,317 for an average homeowner aged 65 plus.
Unsurprisingly, homes are the biggest source of wealth and the importance placed on possessions and protecting them comes to the fore for the over 65s, with home insurance the least likely item to give up, after their car.
Commenting on the findings, Aviva’s business development manager, Simon Warsop, says: “This income gap is understandable, as people in the middle age groups see average household income drop and often face the additional costs of raising children, while debt remains high.”