More are willing to save than spend

THE number of consumers who feel that current Government policy is actively discouraging their propensity to save more money has fallen by 10% in the last month, according to latest figures.

The latest joint monthly savings index from lender Nationwide UK (Ireland) and the Economic and Social Research Institute (ESRI) shows that the percentage of people not confident about saving, on the back of Government policy, fell from 58% to 48% between the end of February and the end of March. Conversely, the number of people who believe policy is actively encouraging a positive savings habit has gone from 10% to 14%, the highest percentage since this index was launched in April of last year.

The overall index — which increased by 11 points to 108 points in March — has been moving upwards since last September. However, according to Nationwide UK (Ireland) managing director, Brendan Synott, the survey shows good and bad trends.

“People are now, on average, more inclined to save than they were last year — with a significantly lower percentage of people now opting to spend any excess money they may have available. Neither of these trends is good news for the prospect of a consumer-led economic recovery.

“However, the response to the bank stress tests may have a positive impact on consumer sentiment and encourage a more balanced approach to spending and saving,” he said.

Last month’s survey showed a marked decline in consumers’ willingness to spend over the last two months. Only 6% of respondents said they would spend any excess money at present, with 53% preferring to pay down debt, 37% preferring to save and 4% looking to invest in shares or a pension.