Only 30% of the UK population have more than one month’s salary in savings – according to a new survey from Paymentsense.
Worryingly, the survey also found that 40% have no money set aside in a savings account and no ‘rainy day fund’.
So what are people saving for? The new findings show that 21% make a holiday their top priority. The percentages were lower when it came to long-term saving goals – like buying a house (10%) and retirement (17%). Just 9% of people save for their children's’ futures, which might include education fees or deposit for a first home.
Top things people save for:
1. Holidays (21%)
2. Retirement (17%)
3. Personal expenses (15%)
4. Family reasons (14%)
5. To buy a house (10%)
6. For my childrens’ future (9%)
7. To buy a car (8%)
8. Other (6%)
66% own one or more credit cards The population's spending appears to be underpinned by rising credit card ownership – 66% admitted they owned one or more credit cards. Meanwhile, 52% of those credit card owners confirmed that they use credit cards to backup expenses.
This over-reliance on credit cards is likely to play a part in savings difficulties. The findings indicate many people weren’t taught to save at all – this may explain the UK’s relatively relaxed attitude towards money. Despite rising interest rates, only 22% of respondents felt very concerned. Meanwhile, another 34% admitted to being slightly concerned about how these increases might impact their monthly outgoings. How concerned are you about the impact of rising interest rates on your financial commitments?
1. Slightly concerned (34%)
2. Very concerned (22%)
3. Not concerned at all (20%)
4. Indifferent (19%)
5. Slightly unconcerned (5%)
31% start saving only after getting their first job Paymentsense wanted to find out more about people’s relationship with money, from childhood to adulthood. While the majority of the population struggle to save, 31% said their parents had opened a savings account for them as a child. Conversely, 31% began saving when they got their first job. Meanwhile, 14% waited until they were married or had a family.
When do people start saving?
1. As a child when parents open a savings account (31%)
2. After starting first job (31%)
3. After marriage or starting a family (14%)
4. When considering retirement (12%)
5. Other (12%)