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Savings levels at record high

Savings levels at record high

Category: Savings

Updated: 28/04/2016
First Published: 28/04/2016

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 It is now over 6 months old so the content may be out of date.

Have you been saving more in the last few months? If so, well done! It seems to be a recurring theme, too, with research from NS&I finding that savings levels have risen dramatically in the last six months, so much so that saving in the 2015/16 financial year hit record levels!

Savings boost

The figures, from the latest Quarterly Savings Survey, show that respondents saved an average of 8% of their income each month in the 2015/16 financial year, only slightly behind the record of 8.04% saved the year previously. However, the actual amount saved came in at £1 more over the year, with an average of £107 being squirreled away each month, the highest amount saved per head over the course of a year since the survey began in 2004.

However, the second half of the year is where things really took off: last summer, 20% of respondents said they were more or much more likely to save over the next quarter, with 78% saying they were likely to maintain or increase their level of saving.

This expectation proved to be correct, with respondents saving an average of 8.18% of their income in the autumn, equating to an average of £110 saved per month. Not only that, but by the end of the financial year, an average of 8.27% was saved per month, despite the monetary figure remaining fairly static at £109 per head.

More work to be done

However, despite the clear improvement overall, it isn't all good news, as there's still an increasing number of respondents who either don't have any savings or don't put money away on a regular basis. Indeed, the figures show that as many as 16% of respondents didn't have any savings in the winter, with women leading this trend (18% of women admitted to having no savings compared with 14% of men).

This represents the largest number of people without any savings in the financial year, and is far higher than the figure recorded this time last year, when just 12% had no savings. It's unfortunately a similar story for those who don't save regularly, with 23% now saying they don't put any money away month-on-month, which is again the highest level seen during this financial year and far higher than the 16% who didn't save regularly in winter 2014/15.

It's difficult to say whether this trend will continue, as although 20% expect to save more over the coming quarter, 56% believe that there'll be no difference in their savings habits, while last year saw a definite drop in savings levels at the start of the financial year. In slightly better news, however, only 15% of respondents felt that they're less likely to save in the next three months, which could signal a change in fortune to last year.

Jill Waters, retail director at NS&I, commented: "This year has been a good year for saving, but we want the New Financial Year to be even better. For those who don't have any savings or do not put any money away into savings month on month, we would suggest that even putting away a small amount helps build a good savings habit, and doing this regularly will really help when saving for a financial goal.

"We hope that the three-quarters of Britons who have said that they expect to maintain or improve their current levels of saving act on that statement, and get the New Year's savings figures off to a solid start."

Get in the habit

If you want to stick to your goal of boosting your savings levels this year, it's time to get started! As Jill said, even saving small amounts on a regular basis could be all it takes, as not only will it get you into the habit, but it'll be a great way to see your pot grow.

This is where an easy access account could come in, as it'll allow you to add funds whenever you can, but you'll still have access to your money in the event of an emergency. If you'd rather avoid temptation, then a notice account may be a better option – you can still add money whenever you wish but will need to give notice to access your funds, which could help you avoid making impulse purchases.

Alternatively, what about a regular savings account? These can be a great way to really get in the habit as you generally have to save a minimum amount each month if you want to secure the headline interest rate – which will often be higher than with traditional accounts – and if you're happy with the restrictions, they could be the ideal choice.

What next?

Compare the top savings accounts to see if you can boost your savings levels

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.