This confusion has failed to deter millennials from saving money as the research found they are putting aside £400 more per year in non-pensions saving than their Generation X counterparts, according to research from Close Brothers and the Pensions and Lifetime Savings Association (PLSA).

The report looked at the views of workers in companies with more than 200 employees and found that millennials were saving £3,445 per year compared to £3,073 by those aged 35-54.

When it comes to prioritising savings, research showed that the younger millennials made short-term savings with 34% saving for holidays, big ticket purchases (13%) or paying down debt (25%), while a third (33%) were prioritising house purchase. 

More long-term goals come lower down the list. Saving to secure a desired lifestyle in retirement is a priority for just 20% of those aged 18-34 whereas it tops the list of savings priorities amongst those aged 35-54 (34%) and those aged 55 and over (50%). 

Despite being designed with them in mind, only 4% of 18-34 year-olds have a LISA (lifetime ISA), with around a third (32%) saying that they are likely to open one in the future. 

However, of the 41% that said they didn’t know, 64% cited a lack of information as a main reason. Of those that were likely to do so, 69% saw it as complementary to their workplace pension, with only 18% saying that they would opt out of their workplace pension when they opened a Lifetime ISA.

Nigel Peaple, deputy director for DC, lifetime savings & research at the Pensions and Lifetime Savings Association, said: “In contrast to the usual stereotype of millennials’ savings habits the Lifetime Savings Challenge Report 2017 reveals a very different picture, with these workers putting away more than any other generation. 

“Indeed, PLSA research conducted last year also found this age group had a desire to save, with 51% of respondents telling us they get more satisfaction out of saving money than spending it. 

“It’s concerning that 44% of millennials find the UK’s savings landscape confusing. The industry and Government must do more to de-mystify savings and make it more accessible to this generation.”

The data is based on surveys conducted among 1,000 employers with 200 or more employees and 2,009 employees from companies with 200 or more employees. The research was carried out on behalf of Close Brothers Asset Management by Opinium in August.