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Brits’ rainy day savings ‘way below’ recommended amount
Nationally, Brits have the equivalent of four weeks of salary in savings, which is much lower than the recommendation by financial planners, but there are huge discrepancies across the region.
Online investment service Wealthify has today launched its Regional Savings Index which analyses the state of Britons’ savings relative to wages.
It found that the average Brit has saved around a month’s worth of earnings but this amount is “way below” the three months recommended by financial planners which means “the country simply can’t protect [itself] from financial shocks.”
The research found that there are big discrepancies across regions with the East Midlands having the largest savings buffer with 11 weeks’ worth.
London comes in second place as the residents here have nine weeks of savings should the worst happen.
In third place was Wales where the population has saved six weeks of their salary into their savings accounts.
At the other end of the scale, those living in the North West have the least amount of savings, with only a two week buffer.
Worryingly, the index which polled 1,000 people aged 19-55 earning under £50,000 a year, showed that women are saving less than half that of men and in some cases, men have saved 10 times more than women.
Wealthify calls itself an affordable and easy-to-use online investment service. It is significantly more cost-effective than alternatives, requires zero investment knowledge and is open to anyone, regardless of whether they have £250 or £2 million to invest.
Richard Theo, CEO and co-founder of Wealthify, said: “The purpose of this index is to highlight how badly people are protecting themselves against financial shock. Hopefully the index will help people recognise the risks they are taking by having inadequate savings. By comparing savings to salary we’re showing the UK’s savings crisis in a new light.
“Hardly anyone in the country is putting away the three months’ equivalent salary recommended by financial advisers, let alone having a proper long term plan. Something has to change. We will continue campaigning to highlight the fact that Britons need not only to save more, but take better care of their money too. If they don’t, people’s financial futures could be far from comfortable.”
