Money News

Economic gloom spurs Brits to save more

Thursday 13 October, 2011

By Martin Fagan

Savings gather momentum as number of savers and size of monthly deposits increase, says Santander

Brits' appetite for saving has increased considerably over the last 12 months, according to new figures from Santander.

The Spanish-owned bank’s Savings' Snap Shot barometer registered that savers have increased the amount they deposit each month, up 12% on this time last year.

At present, Santander says the average Brit deposits £114 per month in a savings account, up from £102 in September 2010. In addition, the total number of people with money saved has increased, leaving just one in five Britons with absolutely no funds to fall back on, compared to almost one in three a year ago.

Santander says this increased uptake in savings may be set to continue, as one in four of those questioned said they intended to increase the size of their monthly deposits over the next three to six months.

The research revealed that men saved £132 a month, compared to the £98 a month saved by women, and the average total amount held in a savings account is £20,604. Currently, 61% hold their money in an instant access savings account, while 43% have a cash ISA.

Looking regionally, those living in the south-west are banking the least each month, making average deposits of £69. In contrast, Londoners are saving 57% more than the national average with monthly deposits of £179.

"The importance of having cash saved for a rainy day has never been more real," said Matt Hall, head of savings at Santander.

“Our outlook for savings over the next 12 months is one of cautious optimism; people are still feeling the pinch as the cost of living continues to rise, but the positive results from our survey shows people are still dedicated to saving."

Highlighting the sensitivity of the public's attitude to saving in the context of the wider economy, as inflation reaches 4.4%, one in four Britons say they are concerned about the impact that this will have on the purchasing power of their savings and 65% said their saving habits were affected by inflation or interest rates.