Seven in ten respondents had put money aside because they were less likely to benefit from it. Of an average of Â£ 1,216 saved, typically 21.5% – or around Â£ 261 – is now gone. However, among those over 55, around 58% kept every penny, double the 29% in the 18-34 age group. The soaring cost of living may explain the decrease in savings. Two-fifths of 1,000 people polled for Paragon Bank said they were spending more now on groceries, renovations and technology than before the pandemic.
People who have kept their savings may see better returns after the Bank of England raised the base rate from 0.1 to 0.25%. Derek Sprawling, the bank’s chief savings officer, said: âAchieving this balance between saving and spending will be critical for savers as we look into the future. financial situation.”
A separate survey by cash machine operator Cardtronics found that four in 10 people who have saved since March 2020 have used it. And Bank of England figures for October show a total of Â£ 6.4bn was paid into savings accounts in October, well below the average of Â£ 11.9bn. pounds sterling during the 12 months ending in September.
Richard Stocker, Nationwide Building Society, said: âOver the last few months, with the opening of stores and businesses, we have started to see spending rebound. Inevitably, people spend more. This means that the growth in savings has slowed down and some people seem to have started spending the money they have accumulated. “
Additional research for Investec estimated that UK households had Â£ 163 billion in excess savings in October, posing a headache. MoneyComms analysis of 50 instant access accounts with balances of Â£ 5,000 in November found only 19 had no penalties, no restrictions on withdrawing money – or relied on short-term bonuses to boost yields.