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Families Who Have Stopped Saving in the Credit Crunch Has Risen Dramatically

Posted on 02. Jun, 2009 in General News

The number of families who have stopped saving in the credit crunch has risen dramatically, figures from Scottish Widows savings and investment report reveal. 85% say they have nothing to put aside, compared to 50% a year ago.

The report says savings habits in Britain are being ‘severely affected’ by the unprecedented economic environment, which has seen unemployment soar and widespread pay freezes. An increasing number of families said daily living costs were preventing them from saving, with 75% giving this as the reason for putting no money aside, compared to 67% in 2008. 42% said their debts prevented them from saving for a rainy day, up 10% from the year before.

Half of the 5,947 adults interviewed about their savings habits said they would be encouraged to save if there was tax relief on all their savings, with almost a third saying high taxes were one factor for their reluctance. As well as having no money to spare, more than one in ten said they did not save or invest money because they were unclear how to go about it. The report said this indicated there was a need to ‘encourage and educate people’ to put money aside for their future, even if they believed they could not afford it.

Source: Daily Mail 02-06-2009

Tags: Credit Crunch