Many savers are now choosing to deny themselves milestone moments, such as major holidays, big wedding celebrations and home renovations, to make ends meet and to put money aside for future essentials.
A survey1 has found that over a third of UK adults, which equates to over 14 million people, view their monthly savings an ‘essential outgoing.’ The research asked respondents to classify themselves as either spenders or savers. Interestingly, eight in ten (82%) respondents who consider themselves to be spenders still put money aside each month, being motivated to build a nest egg for the future.
Generational differences
The amount savers feel they need to squirrel away varies markedly depending on age. Almost half (45%) of savers aged 55 to 60 were willing to forgo expenditure on major milestones to be sure of having enough to cover future essentials such as household bills and nice-to-have items, even if they have savings in place. This was in stark contrast to just 16% of savers aged 18-24 who said the same.
Overall, almost a fifth (18%) of 18 to 24-year-olds said they would feel financially secure if their income covered their essential outgoings, but this does not leave room for any unforeseen one-off costs, such as a car breakdown. A further 18% of the youngest respondents said they did not know what financial security meant to them.
1Gatehouse Bank, 2023
It is important to take professional advice before making any decision relating to your personal finances. Information within this article is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.