UK savings average is falling: MoneyMood

Suggesting the need for better financial planning and budgeting advice among middle-income households, the MoneyMood research revealed that, while more Britons were citing a year-on-year improvement, they were still unable to put money aside.

The survey found that 89 per cent of homes can now cover bills and debts with their monthly income, and 45 per cent have money left over afterwards – a 5 per cent increase from a year ago.

However the average monthly saving across the nation has reduced to £42 a month – a 39 per cent decrease from £69.

John Pollock, chief executive officer for the Legal & General Assurance Society, said: “With inflation remaining stubbornly high and the Bank of England holding the base interest rate low, it’s hardly a surprise that households are losing interest in saving and the mood to spend growing.”

Adviser view

Colin Rodger, director of Glasgow-based Alexander Sloan Financial Planning, said: “Many of our clients are retired and living off savings and capital. Their position has not improved as deposit account rates are generally lower than a year ago, for example National Savings has cut the rate on income bonds this month from 1.75 per cent to 1.25 per cent.”

Key facts:

89% - households that can cover expenses

45% - households with money left over each month

£42 - the average monthly saving