The savings culture needs to change

Myron Jobson

Let’s face it, the culture for saving is on the wane in the UK.

The idea of squeezing every penny, which was embraced by the baby boomer generation, who grew up in the testing recovery and rebuilding period post world war two, is a fading concept in the modern society.

Younger generations quite often adopt a more carpe diem, ‘you only live once’ approach instead, and endeavour to led a lifestyle akin to the high-profile celebrities who they watch on their televisions, tablets and smartphones - at the detriment of their bank account.

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These individuals did not escape the hardships which ensued post the 2007/08 global financial crisis which got people thinking twice on how they spend their money. However, the recovery in the UK economy has reignited the more consumer-centric mindset, in which diposable income is spent on designer labels rather than invested in an Isa.

More needs to be done educate the public to help them make sound financial decisions. The big question is, who is going to take the responsibility for this?

Last month, a group of leaders from across the UK financial services industry, The Savings and Investments Policy, published a report which details a strategic proposals for new savings and investments policies to help rebuild consumer confidence and trust in short, medium and long term savings.

Developing a kite mark for financial guidance, readily accessible to the public and creating a minister for savings in government to champion the message of saving, financial education and guidance are among six recommendations outlined by TSIP.

Though intentions appear to be in the right place, implementing a kitemark could prove to be a difficult thing to do. This has been attempted before in the past but only sparked hostility from IFAs who felt that it would only add to the compliance burden.

However, any attempts to get the public to appreciate their finances are commendable.