One In Four Have No Rainy Day Savings To Fall Back On

Most of us worry about having enough to pay the bills while putting some money away to pay for a comfortable retirement.

But a shocking survey reveals the real state of the nation when it comes to saving – and the results are do not make good reading.

An astonishing one in four people have no savings, while 42% have less than £500 in the bank to help them out if an unexpected bill arises.

The rainy-day savings study did disclose 50% of us have an average £1,300 set aside for emergency spending.

Those aged 65 years old or more had the biggest cash cushion with average savings of £1,614, while half of the retired have at least £2,000 sitting in the bank.

Financial firms not trustworthy

The survey, by a UK financial comparison web site also asked if people trust banks and other financial firms.

One in five said they did not trust them, more than a third (37%) believed banks had done nothing to improve their reputation since the credit crisis and one in eight have looked at alternative ways to save.

Worryingly, only 14% of savers felt they were financially ready for another downturn.

“Savings are essential,” said Georgie Frost, a consumer advocate at the web site GoCompare. “Ask yourself how you could cope financially should something go wrong, perhaps with your car or your boiler, or you lose your job or become sick.

Emergency money

“Without an emergency pot of money to dip into, you might have to borrow to cover unexpected bills, which could leave you further out of pocket in the long run.

“While money is tight for most of us, saving little and often is possible. There are lots of options from using a mobile app that lets you round up your spending to setting up a direct debit to transfer some cash each month into an easy access account that won’t penalise you for withdrawing at short notice.

“The perceived wisdom is to have at least three months of outgoings saved for an emergency. With an average monthly salary around £2,300, the savings people report fall short of the ideal target.”

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