Partner Article

Embracing the entrepreneurial spirit

Mike Morrison, head of pensions development at AXA Wealth talks entrepreneurial spirit.

For financial services this year’s Budget was much anticipated, but ended up being something of a damp squib with little specific to talk about.

However, there was a specific part of the Chancellor’s speech which caught my attention. On the same day as the first episode of the new series of The Apprentice, George Osborne’s Budget highlighted plans for enterprise loans for young people: an initiative that recognises an entrepreneurial spirit in Britons aged 18-24 despite the tough economic climate where youth unemployment is at an all-time high (over 800,000*). This sentiment has echoed some of our own recent research.

AXA Wealth recently undertook a piece of research entitled: AXA Wealth Self. The study considered the nation’s attitude to risk in different circumstances. One of the findings that emerged was that 15% of 18-24 year olds consider themselves entrepreneurs, the highest proportion of any age group. However, there is a fine line between entrepreneurship and recklessness and over a fifth** say they are prepared to either leave a job without lining up an interview for a new role, or indeed having any idea of what to do next.

This ambition in starting up a business or changing job illustrates that young people are naturally able to factor in a greater element of risk given they have fewer personal and financial responsibilities outside of work. When we consider this, it is important to have at least half an eye on how their approach could impact them in the future.

Among other things, entrepreneurial spirit is about taking risks and being in control of your own destiny. Therefore, transposing this to make sure that personal finances are not neglected can be both a timesaver and a safety net. So, a managed approach to risk and some consideration of how this impacts finances is key. Seeking professional independent advice to discuss personal tax planning, savings and investments, as well as considering financial planning for the long-term, will help to support taking a risk in the early years.

The Chancellor’s announcement is further recognition that such enthusiasm and ambition should be harnessed and encouraged. Given the number of young people with an entrepreneurial spirit, more needs to be done to assist this generation to get initiatives off the ground, which in turn, could potentially help to boost the economy. The tough economic climate has put lending at an all-time low, despite government initiatives such as ‘Project Merlin’, but with extra commitment and a will to make it work we could see real success in this area.

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** 22% of 18-24 year olds

This was posted in Bdaily's Members' News section by Tom Keighley .