Number of people not saving on rise
Wednesday, April 11, 2012
The number of people not saving at all has risen, along with a widespread belief that Government policy makes it impossible for people to save.
The Nationwide UK (Ireland) ESRI Savings Index has declined for the second month in a row. More than half of the 800 people surveyed believe they are savings less than they should be.
The latest report, focusing on March, found that 31% of people are not saving at all, up from 24% in Mar 2011. In addition, 44% of people think that now is not a good time to save and 58% believe that Government policy discourages saving.
The group that has been hardest hit are the debt-laden under 50s. Saddled with expensive mortgages, the majority of these respondents said that they would use excess cash to pay down debt.
Managing director of Nationwide UK Brendan Synnott said people are unhappy with their savings despite the improvement in the economy.
"Despite relative stability in the domestic economy and across the eurozone, the index data shows that Irish savers are dissatisfied with the amounts they are currently saving and are wary of influences impacting on the savings environment," he said.
Mr Synnott said there was a generational difference in how people are saving, with the under-50s being unable to save.
"There is a divergence in consumer attitudes towards spending and saving between the over- and under-50s. The under-50s are feeling considerably more financial pressure, and although they are more likely to save on a regular basis, they are less satisfied with the amount they are saving and paying down debt is their preferred use for any spare cash. This group’s inability to save and reluctance to spend will continue to impact on exchequer figures and the Irish economy’s recovery."
Over-50s are more positive about the future and are spending their spare money, with 16% spending spare cash.
Those that save are mainly worried about unforeseen circumstances, with 39% saving for a rainy day. Education and training was the goal for a further 16%, while 10% were saving for a holiday.