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Drop in savings and investment confidence

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30/11/2007

Research from Standard Life has shown a significant fall in confidence in the savings and investment market.

The overall score in the latest Standard Life Savings and Investment Index has decreased significantly since last wave, plummeting from 20 down to 11. This matches the previous all time low recorded in July 2005 when the research first began. It reflects a marked change in sentiment towards property and stocks and shares in particular.

Investment in one’s own property has always been the most popular class by a clear margin since Standard Life first conducted its research.  In October 2006, it stood at a high of 62 points. It still has top place, but has dropped 48% from 46 points in July 2007 to 24 points today, edging much closer to more basic savings categories such as cash and short term deposits at 20 points.

Buy to let property has suffered an even sharper drop, tumbling from 23 points in July to 0 now. In October last year, buy to let stood at 41 points. Stocks and shares are now the least popular choice, hitting a lowest ever index score of -10.

Trevor Matthews, chief executive of UK financial services for Standard Life, said: “These are dramatic results. It’s clear that the recent credit crunch and market volatility have affected people’s confidence.

“Our research shows that there is now a substantial veering towards the less risky cash and short term deposits. At a time like this I believe it is important to remind people not to lose sight of the big picture and to continue to adopt a long-term perspective about assets such as property and stocks and shares.”

 

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