UK Train Fares and the Cost of Living: Exploring the Financial Options for Young People
A recent report by Jane Denton for This Is Money discusses the challenges facing the UK rail network, with Labour highlighting inconsistencies across the system and the high costs faced by travellers. In fact, a journey with Great Western Railway can cost two and a half times as much as a comparable journey in the European Union. During peak hours, a single ticket from London to Manchester can cost £193 (Avanti West Coast, 2026). With train fares under increasing scrutiny, travelling by plane to some European destinations can sometimes be cheaper than making a domestic journey by rail.
However, renationalising the railway does not appear to have immediately addressed the high costs of the system, with the government unable to guarantee lower fares on publicly owned services (BBC, 2025). Despite promises of improved services, official statistics have reportedly shown that train cancellations increased by around 50% in the months following the Labour Government’s renationalisation of South West Railway (Gareth Corfield, 2025).
The wider impact of rising UK train fares and rail disruption
Reliability and cost are priorities for many people using train services. Delays could mean missing a work meeting, a connecting train, or facing other inconveniences. In the current climate, these issues could also lead to more people choosing to drive instead, adding more vehicles and congestion to the roads. This presents another challenge for a government that has set out a Clean Power 2030 mission, alongside a target to cut emissions by 81% by 2035 and reach net zero by 2050 (Labour, 2024).
When analysing the railway system, one fundamental question is why services remain inconsistent. Some disruptions are caused by environmental factors, such as changing weather conditions or fallen trees blocking the tracks. However, when these issues occur regularly, many travellers may question whether enough investment is being directed towards improving the reliability and affordability of existing services, particularly when compared with major infrastructure projects such as HS2. The project has cost around £44.2 billion as of March 2026 (Katy Austin, 2026), with the current plans focusing on the high-speed railway between London and Birmingham rather than continuing through to Manchester as originally intended. This raises questions about how investment is prioritised and whether more could be done to improve the everyday experience of rail passengers.
Unreliable train services do not only affect passengers and the wider community but can also impact businesses that rely on visitors travelling to their area. On Saturday 10th October, services to the North West were cancelled, delayed or reduced for a period due to a fault on the line between Stafford and Birmingham New Street (Watts, 2026). This left football fans, including many Millwall supporters, stranded at Euston, with no immediate way of reaching Preston for the fixture. The disruption meant that some fans faced significant travel difficulties or had to cancel their plans altogether. The knock-on effect could also be felt by local businesses, such as pubs and restaurants, that may otherwise have benefited from the additional customers. Unfortunately, incidents like these can have consequences beyond the railway itself, particularly for people and businesses that depend on reliable transport.
How rising transport costs affect young people’s finances
Whilst there are obvious concerns amongst all users of train services, particularly commuters who rely on them weekly for work, another group affected is young people. Whether they are starting a career, travelling for education or commuting for other reasons, many young people rely on public transport to access cities for work and study, where regular attendance is often required.
Driving might not be a viable alternative for everyone. Older cars can face congestion charges, parking in cities can be expensive, and fuel costs can quickly add up. Electric cars might offer an alternative for some, but the initial cost of buying an EV can be far beyond what many young people can afford.
Looking at the wider financial picture, young adults aged 18–25 spend an average of 48% – 50% of their net take-home income on rent, according to the Canopy Rental Affordability Index. For those in the bottom 20% of the income bracket, this figure can rise to as much as 63%. This puts into perspective the financial pressure many young adults face before even considering rising train fares or the additional costs that come with unreliable services. For some, these pressures may lead them to consider owning a vehicle, despite the costs involved.
With so much of their income already going towards essential expenses, many young people may feel as though their financial options are limited. This raises an important question: what can young people do to make the most of their money and improve their financial position?
Building savings through regular saving habits
The financial challenges facing young people can feel relentless but understanding how to manage money effectively can help build a stronger financial position for the future. One way to start is by putting money aside regularly, with options such as regular savings accounts often recommended by financial experts. Martin Lewis’s team at MoneySavingExpert (2026) highlights regular savings accounts offering interest rates of between 5% and 8% per year. These accounts can help people build saving habits by allowing them to deposit money from their pay cheque each month, with some accounts offering rates that can outpace inflation.
Although regular savings accounts can be a useful first step towards building up savings, they are not the only option and may not suit everyone. Other methods include savings round-ups, which allow purchases to be rounded up to the nearest pound, with the difference transferred into a savings pot. Over time, these small contributions can add up without requiring people to set aside a large amount at once. Depending on the bank, these features may be available directly through its banking app, making it easier to develop a savings habit alongside everyday spending.
Exploring savings and investment opportunities
Naturally, this leads to the question: what happens next, and what are the options for making the most of the money people have managed to save?
Understanding risk and reward is an important part of managing finances. For some, the next step may simply be continuing to review savings accounts, comparing which banks offer the best interest rates and moving money when better options become available. However, some high street banks offer boosted rates for a limited period, which may fall once the introductory offer expires. Keeping track of these changes can help savers understand whether their money is still working as effectively as it could.
Cash ISAs can also be worth considering, with options including easy-access and fixed-rate accounts. Fixed-rate accounts can offer a set interest rate for an agreed period, although access to the money may be restricted during that time. The right option will depend on individual circumstances, particularly whether someone needs access to their savings or is comfortable putting money aside for longer.
Investing is another avenue some young adults may consider as their financial position develops. There are many different financial products available, but understanding the risks involved is important before making any decisions. Risk tolerance plays a key role, as markets can fluctuate and the value of investments might fall, meaning investors may get back less than they put in. Seeking guidance from a qualified financial adviser can help individuals understand their options and whether they are appropriate for their circumstances.
Some financial products are designed to provide a different balance between risk and potential returns. Structured Products offer returns linked to the performance of the Underlying Asset(s) but the level of return and whether capital is repaid depend on the specific terms of the product. If certain conditions are not met, investors could lose some or all of their capital. Structured Deposits work differently, with capital repayment protected under the product’s terms, subject to FSCS limits and the Deposit Taker risk. The benefit of FSCS protection for eligible Structured Deposits means investors capital is protected up to £120,000 per eligible person, per authorised counterparty, subject to the scheme’s eligibility criteria.
Some Securities and Deposit plans may include a Kick Out feature, allowing them to mature early if the Underlying(s) are at or above the defined Kick Out Levels on set Observation Dates. Kick Out Products might also include a defensive feature, which may allow for early maturity even if the Underlying(s) have fallen below their initial level. This can offer an alternative to fixed rate financial products where returns are only paid at the end of the term.
For young people, the potential to receive their money sooner could be appealing, particularly when saving towards future purchases such as a new car or a first home. However, early maturity depends on the product’s specific terms and conditions, so it is important to understand how each financial solution works, including its risks, before deciding whether it is suitable.
For readers interested in understanding these products in more detail, IDAD’s Guide to Structured Products provides further information on how they work, their features and the risks involved.
Making informed financial decisions
Whichever financial path someone chooses, understanding the details, potential benefits and risks is essential. Building savings, comparing interest rates and exploring investment options can all form part of a wider approach to financial planning, depending on individual needs and circumstances. For those considering investing, professional financial advice can help them make informed decisions. Meanwhile, resources such as Martin Lewis’s MoneySavingExpert continue to provide information on savings accounts, interest rates and available offers, helping people explore ways to make their money go further.
For those looking to explore financial products in more detail, further information on IDAD’s range of financial solutions can be found here – Current Products – IDAD
References:
Avanti West Coast (2026), ‘Types of Train Tickets | Train Ticket Options’. Avanti West Coast.
BBC News (2025), ‘Labour cannot promise cheaper rail fares under renationalisation’. BBC News.
Canopy (2025), ‘Canopy UK Rental Affordability Index: Q4 2025’. Canopy.
Labour Party (2024), ‘Make Britain a clean energy superpower’. The Labour Party.
MoneySavingExpert (2026), ‘Regular savings accounts 2026: Earn up to 8%’. MoneySavingExpert.
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