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Media centre /
Press releaseNS&I’S QUARTERLY SAVINGS SURVEY:09 September 2005
Since September 2004, National Savings and Investments (NS&I) has carried out a Quarterly Savings Survey, examining savings patterns and predictions across Britain to provide a comprehensive analysis of the UK savings market. The latest survey covering the summer months of June, July and August includes a review of the year to complete the picture of who are Britain’s best savers, who needs to save more and how the seasons affect our savings. The NS&I Savings Survey includes research undertaken between September 2004 and August 2005. REVIEW OF THE YEAR SAVINGS TRACKER: how have Brits been saving over the past twelve months?
NS&I’S SUMMER SURVEY RESULTS A return to saving After a dip in spring, savings are back up to levels first seen a year ago, with over half the population (55%) saving regularly. The trend to spend less is backed up by recent research publicised by the Bank of England which confirms a slowdown in borrowing suggesting people are facing up to the consequences of the debt they have accrued. And with growing concerns about the savings gap, it seems Brits are finally beginning to take heed. However, still just over half the population is saving regularly and more needs to be done to encourage the rest of the population to start saving for their future. Dax Harkins, senior savings strategist at NS&I, commented: “While it is good news that half of UK consumers are generally saving, this does raise some worrying questions about those who have yet to adopt this habit. We need to encourage all consumers to regularly save a percentage of their income as this is the only way we can overcome the savings gap.” SO WHO HAVE BEEN THE CHAMPION SAVERS OVER THE LAST YEAR? Britain’s best savers Over the last year, NS&I unearthed a breed of savers who go against popular wisdom. The NS&I Savings Survey reveals that the nation’s champion savers, by a considerable margin, are 16-24 year olds or YADS (Young And Determined Savers), who have consistently saved more as a percentage of income than any other age group throughout the year (autumn: 9.80%, winter: 9.25%, spring: 8.06% and summer: 10.11%). A combination of high house prices and the cost of university education have forced this age group to start saving more of their income from an earlier age. However, the research suggests that the percentage of income saved falls dramatically as people get older, despite an increase in earnings. This may be due to increasing responsibilities such as a mortgage or children but is nevertheless a worrying trend that needs to be addressed to remove the savings gap. Dax Harkins, senior savings strategist at NS&I, commented: “The existence of YADS was discovered when we first started to analyse the data. We were delighted to see that the young are leading the way when it comes to savings, which we feel is a highly optimistic sign for the future. Saving is a habit which should be started young and increased in line with earnings.” Next best savers The next best savers were 25-34 year-olds, who recorded a savings high of 7.99% of monthly income in the autumn, continuing the trend towards younger people being more responsible about savings. This figure dropped to 6.31% in spring, though was still higher than the national average of 5.82% for the same period. This age range also boasted the highest number of regular savers over the summer at 62%. Single women: a financially vulnerable group An analysis of the summer quarter reveals that savings are the latest must-have for singletons, with the number of singles saving regularly leaping from 43% in the spring to 53% this quarter. However, it seems that while single men are fully embracing the savings ethic, single women are lagging behind compared to both their male counterparts and to women as a whole. Only 44% of single women saved regularly compared to 60% of single men and 51% of all women. And more worryingly, one in eight (12%) of single women have no savings at all compared to 9% of single men. Dax Harkins, senior savings strategist at NS&I, commented: “It is possible that single women do not feel that they earn enough to be able to save, reflected in the fact that one in eight hold no savings at all. With women typically earning less than men, they may find their income eaten up by mortgage repayments, rent, bills and other outgoings. However, with many having little or no savings to fall back on in emergencies, a lack of financial security is becoming a big problem for Bridget Jones singletons. “We would urge all savers, and single women in particular, to save as much as they can afford every month. Even £50 a month, saved in an average rate instant access account of 3.00%, could add up to £618 a year.” Men vs Women Men outperformed women in every aspect of saving throughout the year, with more men saving regularly (high of 60% in winter and low of 50% in spring) compared to women (52% and 47% respectively) and saving a higher amount of their income (high of 7.26% in winter and low of 5.97% in spring compared to 6.58% and 5.72% for women). Dax Harkins, senior savings strategist at NS&I, commented: “Women are vulnerable to pension shortfalls with many taking a break from employment to raise a family which is why they need to be saving more, earlier, to provide for their own future. “ Part-time workers Part-time workers have saved the highest percentage of income in every season except winter. In the winter part-time workers dropped the level of saving to 7.09% of income, lower than the 7.48% of income saved by full time workers but still above the 6.90% of income saved overall. Bucking the trend, they saved 8.45% of income in spring compared with 6.25% of full-time workers. Seasonal trends Surprisingly, saving levels across Britain were the highest during the winter months of December, January and February. During this quarter 56% of Brits saved regularly and the amount saved as a percentage of income reached a peak of 6.90%. The financial pressures of Christmas seem to have encouraged, rather than distracted Brits from saving. In contrast, the percentage of income saved across the nation hit its lowest point in spring, when savers only managed to put away 5.82% of their salary each month and the number of people saving regularly fell below half the population (48%) for the first time. This fall coincided with a slowdown in spending on the high street, suggesting Brits used this period to pay back debt. The other reason for the shift in savings habits can be attributed to people moving house or carrying out home improvements – key activities for this time of the year – which impact significantly on people’s savings habits. Dax Harkins, senior savings strategist at NS&I, commented: “As an industry, we can use the behavioural trends highlighted by the four NS&I Savings Surveys to better understand the groups that need help with saving and do more to smooth out the seasonal blips to encourage Brits to maintain a more regular savings habit. ”And with almost half the population failing to save regularly, it is more important than ever to offer simple and straightforward savings products to encourage these non-savers to start putting money away for their future.” Regional Review People living in Yorkshire and Humberside proved to be the country’s best savers in the last year, saving the highest percentage of income (8.39% in autumn). The worst savers in the country were those living in the North East, saving only 4.50% (spring). However, the North East bounced back and recorded the highest number of regular savers in the summer, with 66% of residents putting money away while Wales had the lowest with only 42% saving regularly. For further information on the statistics supplied in this release or for a regional trend breakdown, please contact the media team as outlined below. ENDS * Autumn refers to the months of September, October and November 2004 Notes to Editors
Dax Harkins is available for interview and high-resolution photographs can be supplied. Contact the media team to arrange an interview or request photographs by e-mail.
Media team The numbers below are for media use only. Customers wishing to contact NS&I can find details here.
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