Savings shortfall: millions couldn’t cover one month’s outgoings
Millions of Brits would struggle to cover one month’s essential outgoings with their cash savings, new research has found.
Despite Brits’ positive attitude to savings, and 80% of the population having some money stashed away, there is a mismatch between perception and reality, the Barclays study found.
While 86% of savers polled said they could cover at least one month of outgoings, in reality only 60% would be able to based on their readily available savings.
The research also highlighted a short-term approach to savings across the UK with only 21% of savers putting aside a regular amount each month. Almost a third have no regular savings pattern and save depending on their circumstances at any given time.
Clare Francis, savings and consumer expert, Barclays said: “It is really worth individuals being fully aware of their spending habits and outgoings so they can accurately work out how long their savings would last for. This not only helps give peace of mind in case something unexpected happens.”
Separate research from the Money Advice Service found four in ten adults have less than £500 in savings to cover unexpected bills like replacing the fridge or mending the car.
“People in the UK have a ‘spend today’ rather than ‘save for tomorrow’ culture,” said David Haigh, director of financial capability for the government service.