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I couldn't ever imagine spending £5,000 on a piece of jewellery, according to a survey completed by Insure4Retirement, a Home and Travel Insurance provider for the Over 50s it was found that 73% of people who completed a quote and listed jewellery as part of the cover required and they owned over £5,000 worth of gems and precious metals. Data from the Wealth and Assets Survey 2016 (WAS) shows that households with, what the insurance industry refers to as the largest ‘physical wealth’ were people who had reached retirement age, such as my parents, having accumulated more than £66,900 in household assets.
The same survey also shows that those in the 16-24 age group (perhaps unsurprisingly) have the lowest ‘physical wealth’. Now maybe this is because they simply haven’t had enough time to accumulate physical assets but also because the average age for getting on the property ladder has risen to over 30 years old, seven years older than the average in 1960. Simply put, my children don’t have homes filled with stuff, because they are still living with me!!
Despite this being a contributing factor to the huge gap in physical wealth between the younger and older generations, industry analysts realise that this is generally down to the fact that our next generation simply don’t see value in spending their cash on valuables. “Millennials gravitate toward spending money on experiences, and not things” according to Sarah Berger of TheCashlorette.com Today’s younger generation are far more inclined to spend a significant amount of money travelling to locations such as Bali and Thailand – both popular destinations for under-30 Brits - than on fine jewellery.
The move toward spending a higher percentage of income on experiences isn’t isolated to the younger generation according to the Office for National Statistics. The ONS highlighted that households aged between 65 and 74 are now spending nearly a fifth (18%) of their income on recreational and cultural activities. Perhaps fuelled by the recent availability of reasonable travel insurance for older people with medical conditions. Over 65s are spending the highest percentage of their income on package holidays than they have in a long time.
As the rising cost of living eats in to the wallets of UK households, the jewellery and retail industry are competing unsuccessfully for the attention of our young generation. The generation currently aged 18-36 typically spend around 30% of their income on rent, in comparison to the 10% their grandparents would have spent in the 1960s. Leaving them with less to splash out on luxury possessions as they opt for Instagram-worthy brunch spots in lieu.
The diamond industry has reportedly slowed as our Millennial consumers are far-less enamoured by traditional diamond jewellery than their parents. “Diamond jewellery appears to be low on the buying lists” of today’s youth according to Des Kilalea, an analyst from RBD Capital Market. A worrying situation for the jewellery industry, as the Millennial generation edge towards becoming the most active consumer group. According to Insure4Retirement, whose customer base is predominantly made up of baby-boomers, 50% of all specified items of jewellery are diamond. If the jewellery industry can’t find a way to grip the hearts of our youth, we can expect to see these figures decrease with each decade, until the once much-coveted diamond becomes yet another icon of a bygone era.
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The opinions and views expressed in the above articles are those of the author only and are for guidance purposes only. The authors disclaim any liability for reliance upon those opinions and would encourage readers to rely upon more than one source before making a decision based on the information