It has been revealed that one in four adults has absolutely NO savings, according to a recent study.
The sky high prices of modern living as well as trying to clear substantial debt before putting money away have emerged as the main reasons behind this sad fact.
Millennials often get told that we are never going to get as much money as the generation which went before us, but it seems that even our elders aren’t hoarding the cash like we think they are.
Despite not being able to find money to put away, over half of them admitted that they wanted to save cash.
The study of 2,620 people in the UK found that more than one in 10 people admitted to being ‘terrible’ with money.
What is also concerning is one person in 10 admitted they typically spend more money than they earn, with 28 per cent of people saying they sometimes go over budget.
It was also found that one in 10 adults over the age of 55 don’t have one single penny in savings ready for their future – but 38 per cent of 25-34-year-olds are already saving, so millennials are being even more savvy than their elders.
Kris Brewster, head of products for Skipton Building Society, which commissioned the research, said:
Having a healthy savings account is something everybody dreams of, whether its money put aside for a rainy day, helping fund your child through university or money saved for comfortable retirement.
These dreams cannot become a reality without taking time to save in the first place. Very often things like unexpected bills can crop up and have an impact on your savings balances.
But our results found people are more prone to splurging money on things they don’t need, rather than saving it and it’s this that has the greatest impact.
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According to the data, one third of people blamed their lack of fiscal stability on their monthly outgoings being so high they didn’t have anything left.
About one in five people said they were doing their best to get rid of their debt first.
The study found that about 54 per cent of the average Brit’s income goes on essential living costs such as rent or a mortgage, bills and food.
About one in 10 people admit they spend their money pretty much as soon as they get it, and last month fifteen per cent said they spent money on cigarettes, and 58 per cent bought chocolate or sweets.
Four in 10 have forked out for a takeaway, with 45 per cent saying they have had one at least once a month.
If they’re not spending their money, they do try to put away an average of £171 a month into savings, but the ones who do put money away have an average savings balance of about £4,212.40.
This equates to around 14 per cent of each person’s monthly income, assuming no other expenses arise to complicate the savings plan.
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When people were asked where they keep their savings, about one in five Brits admitted to holding their cash in a piggy bank at home, but over two thirds said they save in an ISA savings account.
A quarter of Brits set up Direct Debits to help divert cash straight into their own savings account to force themselves to save, but 44 per cent say they are always on the hunt for discounts to save cash.
Kris Brewster added:
Having a healthy savings balance is not all about being able to put hundreds and thousands of pounds away in one go. The best place to start is to try and save even a small amount regularly each month, then over a year that will add up and make a real difference and help you with your savings goals.
At Skipton, we are here to help people save for their life ahead, so whether you are saving for a rainy day, saving for your first home or for a comfortable retirement, we’ve got an ISA for that.
Here are the top ten things respondents said they save money for:
1 A rainy day
2 A holiday
4 Life’s little luxuries
5 Home improvements/repairs
6 A car
7 A house deposit
8 Paying off debt
9 Periods of unemployment or low income
10 Child’s university fund