Everyday Living Costs Cause Overspending
The cost of everyday living is causing almost a quarter of Brits to dip into their savings, new research reveals.
Rising unemployment and the high cost of living in the current economic climate is placing severe pressure on household finances with 23 percent of the nation using savings to pay for bills and everyday spending.
A further 21 percent use their savings instead to pay for luxury items such as holidays. Almost 16 million British adults have no savings at all however, leaving them with nothing to fall back on, Moneysupermarket showed.
“Many Brits are clearly feeling the pinch more than ever and are being forced to use their savings to pay for everyday household living,” said Kevin Mountford, Moneysupermarket’s head of banking.
“Anyone who currently has no savings at all should take control of their finances and review their outgoings and try where possible to put away even just a few pounds a week – ever penny counts.”
More younger people have no savings, as 39 percent of the 18-34 year-old group have no savings put aside compared to 20 percent of the over 55 group.
The problem young people are facing was confirmed by a Money Skills report by Barclays which showed over a quarter of 16-24 year olds are constantly out of money.
The report revealed 36 percent of this age group regularly run out of money, while 27 percent of those who are unemployed have no cash at all.
A study by Unbiased explained that the nation’s savings pots are being ignored as consumers concentrate on repaying their debts.
A total of £12,081 million was repaid last year, a record amount, compared to the dwindling savings figure of £15,000 billion in the last quarter of 2010, down from £20,000 billion in the first quarter of the year.