Millions of hard working people do not have enough money to save for their retirement, according to a new study.
Table of contents
Around 20% of the adult population in Britain have no savings – which adds up to around 9 million people, says financial firm Scottish Widows.
The figure is an increase of 12% or a million people compared to when the same survey was carried out 12 months ago.
The report gives a bleak interpretation of the finances of many families and workers.
Although around two-thirds have savings, the total is dropping away.
Dire financial straits
The research found 400,000 more adults failed to make any savings last year, while researchers were told by more than half (54%) of the people that they spoke to that they were saving less than they managed two years ago.
The average amount adults saved in 2013 was £10,200, which is a £175 increase on 2012 and £400 more than in 2011.
Most families reported they were in dire financial straits, with 41% confessing they had let relatives borrow ‘substantial amounts’.
One in four had lent money to children to cover their living expenses (35%), towards a cash deposit on a home (34%) or to pay down debts (28%).
Average family borrowings amounted to £14,789 to children, £5,200 to parents and £3,440 to grandchildren.
The knock-on effect was older family members with more disposable income had less to save, and 17% were even slashing their own spending to make cash available to pay bills for their relatives.
Too much debt
These financial pressures also affected the middle generation, who were helping finance their children and parents in some cases.
A quarter of this generation had no savings and this group was also the group saving the least.
The study also revealed debt was playing a large part in the financial problems faced by this age group.
The average amount owed by those aged 35 to 44 years old was just under £6,000, while the 45 to 54 year old age group owed £5,719.
David Lascelles, savings expert at Scottish Widows said: “Although some people are obviously making an effort to save and have managed to put away more money than in previous years, it’s sad that the number of savers is dropping.
“We believe too many people are short-termist in their thinking about saving and do not realise how much putting aside just a little each month can make over a long period of time.”
Related Articles, Guides and Insights
Below is a list of some related articles, guides and insights that you may find of interest.
Questions or Comments?
We love to get feedback from our readers. So, after reading this article, if you have any questions or want to make comments, send us a message on this site or our social media?
Don’t forget that you can also request the guides sent directly to your email inbox.