/ Money

A national savings strategy is needed in 2015

Piggy bank on wall outside house

With a new year approaching, are you beginning to think about how you can boost your savings? We’re calling on the Government to help consumers save more in 2015.

The latest findings from our Consumer Insight Tracker show that while nearly half of us are worried about our level of savings, a third of people are planning to save less in the coming months.

Just one in seven people say they plan to add to their savings in the next year. This is despite the number of people who describe the UK economy as good more than tripling since 2012, rising from 8% to 25%. And more than a quarter say they expect their finances to improve in the next year.

A quarter have no savings

We found a quarter of people have no savings at all. Although not everyone can afford to save more or may be prioritising paying down debts, we previously identified that around 14 million people could be encouraged to save more. Of these, approximately 2.5 million don’t save but could afford to.

As the economy turns a corner, we’re calling on the Government to do more to support better savings habits next year, and by doing so, help households that can afford to save improve their ability to cope with financial shocks.

In 2015 we want to see a national savings strategy introduced, to be developed with the financial services industry, employers and consumer groups.

We know that this is a key concern for many. Our Scrap the Savings Trap campaign is supported by more than 52,000 people who believe savings providers could do more to help consumers get the most from their savings.

Get more from your savings

We’re calling for banks and building societies to ensure their customers’ money is not left to languish in sub-standard savings accounts. We also want them to make ISA switching easier and stop leaving customers in the dark about the best return on their savings.

Our previous research into savings behaviour has found that the following are strongly linked to successful saving:

  • Saving regularly each month – this is crucial to building and maintaining a three-month savings buffer.
  • Saving for a rainy day – saving a regular amount is more successful than saving towards a specific goal like a holiday or car.
  • Keeping savings separate from other money – those with a savings buffer are more likely to have a specific savings product which means it feels like a separate ‘pot’ and they are less likely to dip into it.

Do you adopt any of the savings behaviours above? How do you think the Government could help you save more in the year ahead? Do you want better savings accounts, work schemes or more flexibility to move your money?

Comments
Profile photo of Castle
Member

None of the above

Just better rates!

Member
Mycallc says:
28 December 2014

The Government is responsible for killing savings rates.

Profile photo of alfa
Member

When a savings plan comes to an end, banks and building societies should be forced to move your money into the best plan available not the worst.

Profile photo of malcolm r
Member

You deposit money with your bank. They invest it (stocks, shares, bonds, PFI projects….), and from their return they take off admin costs, a profit and then you’ll get a little bit back as interest. If you want more interest then other dependent interest rates will rise – mortgages, business lending and so on. So costs will rise – for your house, products and services you buy. So higher inflation. That is how my simple mind sees it – but maybe wrongly.

My strategy would be to cut out the banks. Lend money directly to the Government to finance their capital programmes – instead of costly (and lucrative for the banks etc) PFI deals, instead of going to China to finance HS2, instead of getting the French to finance our nuclear power stations. All these projects will make money for those financiers – so why not make that money for us, using our investment, instead – and get the projects cheaper. Government bonds that pay a decent return then?

If the Government has any ability to properly cost these projects to generate a return then we should benefit, not overseas investors. But maybe therein lies the flaw?