Just one in five young adults used matured junior ISA (JISA) savings for a house deposit despite strong homeownership ambitions, according to research from Skipton Building Society.

The study found that only 22% put their JISA funds towards buying a first home, even though three-quarters (75%) had considered using the money for a deposit.

Instead, education was the most common destination for the savings, with 27% using the funds to pay for university, training or further study. Nearly a quarter (24%) spent the money on day-to-day living costs, while 20% used it for socialising, hobbies or personal purchases and 14% paid down debt.

The findings are just the latest example of financial pressures facing young adults as they juggle immediate expenses with longer-term homeownership goals. Two-thirds (66%) said they would make different decisions if given the chance again, while four in five (80%) felt they would have benefited from more guidance when their JISA became accessible at age 18.

The research also points to strong demand for products that link childhood savings with homeownership. Almost all respondents (95%) said they would be interested in transferring some or all of their JISA savings into an account offering incentives towards a first-home purchase. Meanwhile, 87% said access to financial support or guidance when their savings matured would have been helpful.

Jazz Gakhal, CEO of money at Skipton Building Society, said: "Following the Government’s confirmation of the new first-time buyer ISA, there is an opportunity to create a clearer pathway from childhood saving to homeownership. Giving eligible young adults the option to move some or all of their matured Junior ISA savings into the new First Time Buyer ISA could help more families turn years of careful saving into a meaningful step towards owning a home.

"JISAs launched in 2011, so the first cohort able to hold one from birth will turn 18 in 2029, the same year the new First Time Buyer ISA is due to launch. Putting this pathway in place from the outset would give those young people a clearer choice when their savings mature.”

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