Almost 10 million adults unable to save money each month
The number of UK adults unable to save money on a regular basis has doubled in five years – impacting almost 10 million people – a report on the nation’s finances reveals.
One in five (22%) people are unable to put cash aside on a regular basis, compared to 12% in 2019, according to Yorkshire Building Society’s ‘The Saving the Nation’ report.
A quarter (24%) of the people polled said they often ran out of funds before payday, and one in five (21%) couldn’t rely on their financial reserves to last longer than a month if they needed to.
The mutual’s study which highlights the financial impact of ‘economic shocks’ such as Covid, cost-of-living crisis and the war in Ukraine, also revealed that debt levels were on the rise among 35–54-year-olds. On average, people in this age group went £713 further into the red compared to £526 nationwide.
Gap between savers and non-savers is widening
There’s evidence of the UK’s widening financial wellbeing gap – the gap between non-savers and savers – as those able to save put away 50% more cash than five years ago. They were helped by lockdown restrictions during 2020 and 2021 which meant many were spending less and saving more.
On average, people who were topping up their savings pot put £256 away each month, a rise of £100 since the last set of results in 2019.
Despite the improvement in the nation’s ability to increase their saving pot, UK adults said they needed a nest egg of £17,345 to feel financially secure, yet only a third (35%) confirmed they had this figure in cash savings.
Further, only one in 20 of those aged 35-54 strongly agree they would now have sufficient money when it came to their retirement and one in ten (9%) of those aged over 55 said the same.
Savings buffer ‘isn’t a reality for everyone’
Chris Irwin, director of savings at Yorkshire Building Society, said: “The reality of our analysis shows just how far away we are as a nation from reaching a state where everyone feels they have sufficient reserves to be financially secure.
“While it’s positive to see that overall, the UK’s financial resilience has improved, we hope those who have been able to increase their savings will maintain good money habits and grow their savings safety nets.”
He added: “Sadly though, having a savings buffer isn’t a reality for everyone, with many now more exposed than before to financial shocks.
“Now more than ever, with current and potential future economic uncertainty, it’s important for people to try and build their financial resilience and for the wider financial services market, and policy makers, to help people to save.”