We all know we need to save for the future but reining in spending can feel like an impossible task. Investment specialists, Legal & General, take an in-depth look into Britain’s saving habits, the psychological reasons why we don’t save more and the best way to grow your money according to the experts.
- Less than 50% of Brits add to savings every month
- 1 in 5 rarely or never save
- 31% of people have £1,500 or less in savings
- 22% have over £20,000 in savings
- ¼ of people save via stocks and shares ISAs
A survey conducted of over 2,000 UK adults aged 18-64 showed that Brits are struggling to put earnings aside for rainy days, with 9% of those surveyed having less than £500 in savings. A shocking 15% have no savings at all. Savings for those in the UK reached the lowest level for 50 years in 2017 with savings as a percentage of household income falling to 4.9%, the lowest figure since records began in 1963.
Dr Kristina Vasileva, senior lecturer in Finance, University of Westminster, comments: ‘Self-control bias is the human behavioural tendency that causes us to fail to act in the pursuit of long-term goals due to lack of self-discipline. Money seems to be one area where people are displaying a huge lack of self-control.’
Following recent reports of a gender pay gap, our survey found there’s also a gender savings gap. 55% of British male adults add to their savings each month, compared with only 43% of women. And almost 1 in 4 men have more than £20,000 saved – whether in ISAs, stocks and shares, or savings accounts – compared with less than 1 in 5 women.
Savings offer many benefits such as financial security, opportunities for a better future and less stress. Experts recommend having a good understanding of inflation, current markets, what’s available, and just how we like to save and spend.