How young people can cope with financial uncertainty
Sarah Rigney
Staff Writer

Here we explore what financial issues young people in Ireland are facing today and what steps can be taken to alleviate financial pressure and plan for the future.

It’s common knowledge that young people in their twenties and thirties are facing financial difficulties and hardship. 

While there may not be a silver bullet that will solve the issues being placed on young people's shoulders, the outlook doesn’t necessarily have to be pessimistic. 

We decided to investigate what options the younger generation has to better manage their finances and build a healthy financial future. 

Before we jump into our tips, let’s quickly review the main stumbling blocks young people may run into.

Issues being faced by young people today


The average age of the first-time buyer in Ireland has risen by five years to 34 over the past decade, signifying the struggle younger people experience in purchasing a home. Homeownership may soon be a pipedream for those in their twenties.

Irish house prices grew by 12.2% between August 2021 - 2022, meaning that someone who owned a home worth €300,00 in August last year now has a home worth €336,600 - a wealth increase of €36,600. 

Renting and the inability to save

Hindering the ability to buy a home is the cycle of renting and lack of rent control, which has squeezed young people’s incomes and reduced their capacity to save. This has resulted in the creation of ‘generation rent’.  

According to the Residential Tenancies Board (RTB), rent increased 9.2% in the year leading up to quarter 1 of 2022, with the average new tenancy rent of €1460. 

Renting is an obvious deterrent when it comes to young people fleeing the nest. In 2021, the average age of people who moved out of their parent's homes was 28.4; a jump from 26.8 in 2019 and 25.4 in 2012. This is a stark contrast to the EU average, which stands at age 26.

Pensions and savings

Due to the high cost of living and inflation, young people have less money available to invest in a pension scheme. 

One-third of people without private pensions state they simply cannot afford one, with another third saying they hadn’t got around to organising it. 

A significant number of people could be made more financially secure in retirement just by being advised on how to set up their pensions.

Moreover, Ireland has an inverted population pyramid, meaning the proportion of older people in retirement is high compared to the rate of young people working in the economy. Younger people pay more tax - approximately €2,500 annually - to fund the ageing proportion of society.


In terms of employment, younger people are more likely to be on temporary contracts. In 2019, 9.7% of the total workforce was on a temporary contract, but 24.2% of those under 30 were on temporary contracts. 

Over one-third of those on temporary contracts were doing so involuntarily, highlighting the fact that younger people are more likely to be in unsustainable employment.

According to research carried out by the Nevin Economic Research Institute, younger people are more likely to have a degree than older generations. Despite this, many younger workers are employed in retail and service jobs, which often pay less and are less secure. In fact, over one-third of young people are over-skilled for the work they are doing.

Inheritance hurdles

Back in 2009, a child could inherit or be gifted €542,544 from their parents before having to pay tax, with the rate at the time being 22%.

However, now under Capital Acquisition Tax (CAT) rules, according to Revenue, a child can inherit €335,000 from their parents before they have to pay tax at 33%.

How to cope with financial uncertainty 

1. Budget wisely

When reviewing your finances for the future, the first thing you should do is create a realistic budget. You will be able to decide when and how to spend your money properly, giving you control over your finances.

It’s important to stick to your budget as best you can to manage your money with little stress. There are apps and websites available to create a budget.

The Money Advice and Budgeting Service (MABS) outlines three key steps to creating a budget:

  1. Identify your short-term and long-term goals 
  2. Figure out where your money is going
  3. Think about your wants and needs

Budgeting tips:

  • Keep all receipts and bills.
  • Be realistic about how much you need and don’t make your budget too tight. 
  • Update your budget with any changes regularly, e.g. Wage increases.
  • Compare your budget to what you actually spend at the end of each month. 

You may find it useful to follow the 50:30:30 rule, which is as follows:

  • 50% of your take-home income goes towards your needs (rent, food, transport, etc.)
  • 30% of it goes towards your wants (holidays, socialising, clothes)
  • 20% of it goes towards savings (holidays, mortgage deposit, retirement)

If you want to cut down on your expenses, consider the following: 

  • Review your subscription services.
  • Reduce the number of takeaways, coffees, etc. you purchase.
  • Avail of discounts and reward schemes where possible.
  • Shop around and compare prices before making purchasing decisions.
  • Buy second-hand items.

You can discover more everyday saving tips in our article on how to beat rising inflation.

2. Start a pension early 

If you're in your twenties, you may not have given retirement much thought as it seems like a lifetime away. However, everyone needs to start a pension at some stage and the earlier you start, the easier it will be. 

Knowing what your pension options are when you’re early on in your career can benefit you in the long run. Most workplaces offer pension plans, to which your employer will often contribute. 

The Government is now making it mandatory for all employers to contribute towards a worker’s pension, which will be co-funded by the State. Workers will be automatically signed up for a pension when they start work.

The new auto-enrolment pension scheme is to be up and running by 2024. 

You can learn all about pension basics in our beginner’s guide to pensions.

3. Know your saving options

Getting into a good saving habit at a young age can help you build a healthy financial future.

Some saving options include:

  • Managed funds
  • State Savings products
  • Specialised savings accounts
  • Cryptocurrencies 

You can learn about all of these options and more in our article on saving options here.

4. Learn how to prepare for a mortgage

If applying for a mortgage is on your agenda, you should know what it takes to get mortgage ready. Here are some tips:

5. Avail of home buying schemes

With house prices on the rise and mortgage rates shooting up, it may seem impossible for young people looking to buy a home to overcome these hurdles. 

However, it’s not all doom and gloom as the Government has put in place several initiatives to aid mortgage-seekers.

  • The Help-to-Buy scheme: This Government tax refund scheme is designed to help first-time buyers obtain the deposit needed to buy a newly built home. You can learn all about this scheme here.
  • The First Home scheme: This shared equity scheme aims to help first-time buyers bridge the gap between the amount they can borrow under the Central Bank's mortgage lending rules and what they need to borrow to buy a home. Discover all you need to know here.
  • The derelict or vacant home grant:  This grant allows first-time buyers to purchase a derelict or vacant property and turn it into a home without the need for planning permission. You can read more about this grant here.

6. Be mindful of your credit history 

If you’re one of many hoping to apply for a mortgage, it’s important to know that lenders will run a check to view your credit history on the Central Credit Register (CCR). They will assess your credit history, which shows your ability to handle repayments. 

A credit check will show the repayments you have made on any loans you have. It will also identify red flags, such as gambling habits or missed repayments.

In the run-up to applying for a mortgage, it’s best to ensure you clear any outstanding credit you have remaining or try to pay off as much as possible.

7. Consider emigrating

Despite the cost of living crisis and the housing shortage affecting countries globally, for many young people moving away to greener pastures is still the answer to a more financially secure future. 

Ireland has a long history of emigration, with many people harnessing a “grass is always greener” mindset. A recent study carried out by ​​the National Youth Council of Ireland (NYCI), revealed that more than 70% of adults surveyed aged between 18 and 24 are considering emigrating to secure a better quality of life overseas.

The CSO’s population and migration estimates for the year to April 2022 show the number of people emigrating rose to its highest level since 2017, with 27,600 Irish nationals emigrating.

The top English-speaking spots for young people emigrating are the UK, Canada, Australia, and New Zealand. 

Other inviting destinations include our neighbouring European countries, and the UAE, which attracts young people with the prospect of tax-free wages.

You can learn all about emigration and discover the answers to your questions in our guide series on moving home or abroad

Discover more money-saving tips

If you found this article useful, make sure you check out some of our other personal finance articles:

Stay up to date with our top tips by keeping an eye on our blog and guide pages.

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