Exploring Generational Differences in Scotland's Economic Wellbeing

The Economic Wellbeing Explorer is Smart Data Foundry’s interactive, map-based tool that provides policymakers, economists, service providers, and NGOs with the granular insights they need to tackle poverty, reduce inequality, and build economic resilience across communities. It gives a multi-dimensional view of financial wellbeing—drawing on real-world data at the national, regional, and local levels.

Now updated to August 2025, the Explorer sheds light on emerging patterns in personal finances across Scotland, with key indicators pointing to ongoing challenges and some encouraging signs of adaptation amid tough economic conditions.

Key Scotland-wide Indicators (August 2025)

• Proportion of people with overdrawn accounts: 16% (no change month-on-month)

• Proportion of people spending more than 120% of income: 11% (no change MoM)

• Proportion of people with low emergency resilience: 34% (up 1% MoM)

These headline figures indicate a largely static picture, but stability here should not be confused with improvement. Rather, the data suggests many individuals and households remain stuck in a fragile financial position, with a significant one-third of the population lacking basic financial buffers.

This persistent lack of emergency resilience is concerning, particularly as inflation remains above target, housing costs continue to rise, and interest rates remain high.

Deeper dive: Generational Differences in Financial Wellbeing

Key insights:

Encouraging reductions in living beyond means

Across all age groups, there has been a year-on-year decline in the proportion of people spending more than 120% of their income, potentially signalling more cautious financial behaviour as households adapt to prolonged economic uncertainty.

This shift may reflect:

• The ongoing cost-of-living crisis prompting yet more cutbacks on discretionary spending.
• This month’s Economic Nowcast shows that Scottish incomes increased by 6.29% MoM, improving peoples’ financial position.
• A tightening of lending criteria by financial institutions, limiting the ability of younger people in particular to take on new debt.

Youth most vulnerable to financial shocks

While more people are able to make ends meet, more than half (54%) of 18–39-year-olds have low emergency resilience, meaning they lack sufficient a financial buffer to cover a sudden expense. This remains unchanged year-on-year. This is a critical area for intervention, particularly as this age group is:

• More likely to be renters, with limited access to affordable housing.
• Exposed to unstable or insecure work, such as gig economy jobs or short-term contracts.
• Carrying student debt and facing rising childcare costs.

Despite progress in managing spending, this group remains precariously placed in the event of job loss or unexpected costs.

Older adults: less overdrawn, but signs of stress

The overdrawn rate among those aged 70+ remains low at just 4%, and their emergency resilience is relatively strong. However, a 0.7% rise in low resilience year-on-year may reflect pressure on fixed incomes from:

• Inflation outpacing pension increases, particularly for food and energy.

• Erosion of savings, especially among those helping younger family members financially.

While seemingly minor, these changes hint at increasing pressure on what is traditionally considered a more financially secure group

Coming Soon to a Local Authority Near You

Currently focused on Scotland, the Economic Wellbeing Explorer enables organisations to design targeted, place-based interventions that reflect the unique financial landscape of each community. Whether refining national strategies or enhancing local service delivery, the Explorer is a critical tool for unlocking the power of data in the fight against poverty and inequality.

From late 2025, the Economic Wellbeing Explorer will be rolled out to England and Wales, expanding its reach and impact across Great Britain.