Rising general living expenses and tax increases are forcing UK residents to dip into their savings more and more. According to a survey published by the ING Direct Bank, the average saver had nearly £1,800 in their savings accounts the first quarter of the year, one of the lowest figures since tracking of savings began. This figure marks a decrease of 10 per cent on the previous year and a further 2% down on the same period in 2009.
The bank cited increased living costs to blame for Brits having to raid their savings, with the survey also showing that 41% had used the money to pay for essentials such as fuel or food. The current unstable job market was also blamed; with savers using the money to offset some of their debts should they find themselves suddenly unemployed.15% of people questioned were worried about being made redundant and approximately 18% had used their savings to pay off borrowings in case this happened.
The research showed that people on lower earnings, as well as younger savers, were more likely to use money saved to tide them over with the average level of saving for those ages between 18 and 24 dropping 40% in the past 12 months to just under £500. Those earning less than £22,000 per annum saw their savings fall to £595, a drop of 21%.
A third of the people interviewed were hoping to build their savings back up throughout the year.