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7th December 2018
Majority of the UK has set a savings goal, but it could take years to reach, says Aldermore
The latest annual Savings Tracker from specialist Bank, Aldermore, reveals that 78 per cent of savers in the UK have a specific goal to keep them focused and motivated, although the rate of savings is making it difficult for them to reach these goals.
Despite the challenging savings environment, it is encouraging that 75 per cent still believe it is important to save, with retirement being the number one priority for 31 per cent.
The Savings Tracker found long-term savings objectives differ across the demographics, with men more likely to be saving for retirement (34 per cent vs 27 per cent women), while women are more likely to be saving for a house (20 per cent vs 12 per cent men).
Those in their 40s and 50s are most likely to be saving for retirement, while 35 – 44 year olds are most likely to be saving to pay off their mortgage (26 per cent) and unsurprisingly, 18 – 24 year olds are saving to buy their first house (49 per cent).
The research has uncovered a worrying savings gap. With people saving 7 per cent of their pre-tax income in 2018 compared with 8 per cent in 2017 (the equivalent of £1,798 vs £1,832), major goals such as buying a house, planning a wedding, or making significant home renovations could take many years to reach based on the current rate of saving.
It is clear too, that saving for short-term goals can get in the way of the long-term goals – 36 per cent of savers agree that saving for their short-term goals affects their ability to save for long-term objectives, with saving for a holiday a top priority for 41 per cent of savers.
Ewan Edwards, Head of Savings, Aldermore, said: “Despite a low interest rate environment, it is encouraging to see that 75 per cent of the UK believes saving is still important. However, not only are savers putting less away, we have found that a significant proportion of adults in the UK still do not save at all. This means reaching long-term objectives is going to be extremely difficult, especially for those saving for retirement or a house. Instead, setting aside a regular amount each month can make a goal more achievable.”