Finance Choices
Brits squandering savings
UK savers have been taking out almost double what they are putting away in the last three months, Birmingham Midshires finds.
In its latest Saving Britain report, the bank reveals that Brits added £266 to their savings accounts in the last three months, but withdrew an average of £448.
Men saved the most over the period, at an average of £412 each, with their female counterparts saving far less at £127 a woman.
But men and women both raided savings by far more than they invested - at £703 and £211 respectively.
"Our latest research shows that while Brits are realising the need to save, their lack of discipline when it comes impulse luxuries and their inability to predict surprise bills has caused them to dig deep into their hard-earned savings," said Richard Brown, head of savings products at Birmingham Midshires.
Eighteen per cent of Brits blamed piggy bank raids on unexpected bills or expenses, with impulsive shopping the second most common reason at 15 per cent.
Those in their forties were most guilty of withdrawing money from their nest eggs, taking out on average £1,307 each - quadruple the amount they saved.
The youth of today fared far better, with Brits in their teens and twenties saving more than they took out.
Sixteen to 19-year olds saved on average £214 more than they took out in the last three months, with twenty-somethings saving more than twice as much as they withdrew.
And Birmingham Midshires is urging the rest of the country to 'think young' and save sensibly.
"We would urge people to think carefully about a realistic amount they can set aside each month so they avoid plundering their account on a regular basis. Setting aside a smaller amount of money each month and leaving it untouched is a much better than saving more than what is possible and being forced to raid," concluded Mr Brown.
In its latest Saving Britain report, the bank reveals that Brits added £266 to their savings accounts in the last three months, but withdrew an average of £448.
Men saved the most over the period, at an average of £412 each, with their female counterparts saving far less at £127 a woman.
But men and women both raided savings by far more than they invested - at £703 and £211 respectively.
"Our latest research shows that while Brits are realising the need to save, their lack of discipline when it comes impulse luxuries and their inability to predict surprise bills has caused them to dig deep into their hard-earned savings," said Richard Brown, head of savings products at Birmingham Midshires.
Eighteen per cent of Brits blamed piggy bank raids on unexpected bills or expenses, with impulsive shopping the second most common reason at 15 per cent.
Those in their forties were most guilty of withdrawing money from their nest eggs, taking out on average £1,307 each - quadruple the amount they saved.
The youth of today fared far better, with Brits in their teens and twenties saving more than they took out.
Sixteen to 19-year olds saved on average £214 more than they took out in the last three months, with twenty-somethings saving more than twice as much as they withdrew.
And Birmingham Midshires is urging the rest of the country to 'think young' and save sensibly.
"We would urge people to think carefully about a realistic amount they can set aside each month so they avoid plundering their account on a regular basis. Setting aside a smaller amount of money each month and leaving it untouched is a much better than saving more than what is possible and being forced to raid," concluded Mr Brown.
posted by Bruce Wayne at 5:14 AM
Brits squandering savings
6 Comments:
Hmmm. Never looked at what I was saving percentage wise but here goes.
15% in my 401k
3% company stock purchase plan (15% discount).
600 a month from auto pull into two savings accounts
Then when cash accumulates to much in my checking account I transfer additional moneys over. This happens about every other month and in March when raises, bonuses and tax returns come.
I also purchase individual equities from time to time in little lots of 250-500 dollars through direct purchase programs.
I could probably do a lot better but I dont think I have balanced my check book in 5 years so I always leave a cushion.
I just started buying savings bonds I am buying two $50 ones every month I am paying my house off this year with my savings so I figure when that is paid for & I have no money in the bank at least I will have these savings bonds in case of emergency until my savings gets built back up. I am an IC so I have no 401k but my main income is from one company if I get paid each month 1 time from another company I use that to buy the savings bonds.
If I include short-term and long term savings I save around 35% of my gross income. I'm also single, 44 and have no children, just well loved nieces
18% in 401K - max out every year.
$4000 in Roth IRA - max out every year.
$8000 in other savings - mutual funds, CDs whatever.
$1800 - new car fund
$1200 - short-term savings fund - currently saving for a vacation next year to Canada
I have a larger house than I need, but since it's close to my nieces I plan to stay here till they get to college. I'm not pre-paying the house mortgage because the interest is only 4.5% for 4 more years and I think I get better returns elsewhere.
In the past few years I have been able to save about 45% of my gross earnings in savings thanks to having no debt. Of that amount 20% goes to my 401K which in hindsight has been a dumb decision because the investment choices at work SUCK. I believe I have earned no return on it other than my company match in 11 years.
The reason why I save so much is it appears our standard of living here in the US has been falling by the the minute and if you are not prepared financially I would fear for your mere survival.
Since my first goal is to eliminate my credit card debt, I put most money towards that. My eventual goal will be 15% of my income to go into savings ~ I can't see it won't be possible, considering the money I pour into my bills at the moment. I don't spend carelessly.
I can't really say how much we save every month b/c it varies. Basically if there is money left before the next paycheck (which there usually is) I pick somewhere to put it. Since my and DHs IRAs are almost maxed out, we've been putting the extra toward student loans. I always pay a little extra on the car payment every month too. We have comfortable savings already (about 6 months of salary), so I don't work on building that up too much.
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