Bank: Regular saver has ‘evaporated’

The regular saver who puts €50 or €100 aside per month has “evaporated”, according to the managing director of Nationwide UK (Ireland), Brendan Synnott.

“People with lump sums are locking them away, but the man in the street has been wiped out as a saver,” said Mr Synnott.

He said people are always more wary of saving in the run up to what they perceive will be a tough budget.

He was speaking yesterday as the Nationwide UK (Ireland)/ESRI Savings Index showed increased negativity towards the saving environment.

“There is a lot of fear out there. There is fear of an increase in DIRT tax and tax rates in general,” said Mr Synnott.

“The fear leads people to pay down their debts,” he said.

Mr Synnott said that the savings index — which measures the amount of people are saving and their attitudes toward saving — remains near the all-time low.

The savings index increased two points in September, despite increased negativity towards the saving environment, as well as an increasing propensity for people to pay down debt rather than save surplus cash.

The Savings Environment sub-index — which measures the influence of government policy and the economic environment on consumers’ attitude to saving — declined nine points in September to 90, its lowest recorded level since the 2010 budget was announced.

Despite fewer people saving regularly, there has been an upward trend in the proportion of people who say they are happy with the amount they are saving, which now stands at 16%. This compares with 13% last month and this time last year.

The percentage of savers who report that they are saving less than they should remains high, at 60%, but this has declined from 66% a year ago and 65% last month.

Some 77% remain positive about their ability to maintain their level of saving over the next six months, while 9% expect to be saving more.