One in four Brits save nothing

| March 10, 2009 | 0 Comments

Nearly a quarter of Brits have no money set aside in a savings account, according to research by Nationwide building society.

The study in savings trends found that 23% of respondents had nothing in a savings account, whilst the number of people who consider saving important has dropped 25% compared to a year ago.

Repeated cuts to the Bank of England’s base rate to one tenth of what it was in October were to blame for the fall in the perceived importance of saving, Nationwide said.

Falling returns are pushing consumers away from holding money in banks and building societies, Nationwide warned, reducing the funding available to mortgage lenders.

Despite the drop in the perceived importance of saving, many Brits believe they are saving less than they should.

Six in ten (59%) respondents said they are saving less than they need.

Over half (52%), meanwhile, said they will be saving the same amount of money as they are now in six months time - suggesting that whilst savings need to increase, many savers are unwilling to change their habits.

Andy McQueen, Nationwide savings director, said: “We’re very concerned that since we started monitoring the savings habits of the UK last year, the importance consumers put on saving has been falling.

“As job security across the UK worsens, consumers do need to have a nest egg built up that will cushion them through any unexpected financial crisis.

“Even though returns are smaller at the moment, it’s still just as important for people to regularly put money aside.”

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