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Savings suffer from rising cost of living

Savings suffer from rising cost of living

Category: Savings

Updated: 28/10/2013
First Published: 28/10/2013

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

According to research from Nationwide, the rising cost of living is taking its toll on people's ability to save with 11% of those surveyed having less than £100 put aside for a rainy day.

A further one in five savers, or 21%, have less than £500 in savings, whilst one in ten people don't save at all and over a quarter (27%) don't save on a regular basis.

And it seems that those who do save will often need access to the funds they've managed to amass. Thirty-four percent will dip into their savings pot at least once each quarter with 41% having an instant access account, while only 48% are taking advantage of the tax-free benefits a cash ISA can offer.

Meanwhile, just 9% are prepared to lock their money away into a fixed-rate bond despite the higher interest rates that can be offered, indicating the continued financial uncertainty a lot of people are facing.

The research, based on a survey from YouGov with a representative sample of 2,074 individuals, highlighted the impact that the rising cost of living is having on savers with many being under-prepared should emergencies crop up.

That's why industry experts are urging people to save as much as possible, because even though saving is difficult, families could be put under even more financial strain should they face an unexpected bill.

Darren Bailey, head of savings pricing at Nationwide, commented:

"The rising cost of living continues to impact family finances and despite wanting to save, many are finding they just don't have the spare money.

"Yet, even putting a small amount aside each month can produce a decent nest egg which can give families funds to fall back on should they need to."

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