Latest stats out from the Office for National Statistics (ONS) show how we’re spending our money - and it doesn’t make for great reading. Not least as the savings trend - or should I say the not saving trend – continues to fall.
In 2017, the savings ratio (the level of gross disposable income saved) fell to just 3.9%, the lowest level since records began back in 1963. A shocking and what is, frankly, an alarming level. Low interest rates are blamed in part, something that undoubtedly the Bank of England has contributed to in its attempt to keep the country afloat by encouraging us to spend and not save our hard-earned cash.
The average weekly household expenditure in the UK was £572.50 for the financial year ending 2018, which apparently is the highest level since 2005.
40% of average weekly expenditure goes on transport, housing (excluding mortgages), fuel and power, along with recreation and culture. Transport accounts for the biggest weekly expenditure, with an average spend of £80.80 a week. So, we may have low levels of unemployment, but it seems we’re paying a price getting to work.
These figures are all based on stats for the tax year ending 2018, so the picture today could be slightly different - and of course with Brexit just around the corner, a lot can change. There is certainly concern that Brexit will affect spending, if it hasn’t already. The report highlighted that we, in the UK, are now net borrowers, which means that credit - and it seems cheap credit - is a factor for high spending.
10 years of record low interest rates aren’t helping to encourage people to save but it doesn’t matter how good the rates are if people don’t have the resources to save in the first place.
If you have any savings questions or need any help with finding the accounts that are most suitable for your needs, please call us on 0800 011 9705 to speak to one of our expert savings specialists.
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