A 16-month high as many make resolution to save

Around 79 per cent said they were now setting aside money either on a regular basis or occasionally, the highest level since September 2008, according to Nationwide.

The proportion of people who do not have any savings at all also fell from 25 per cent in December to 21 per cent in January.

The group attributed the increase in the number of people who were saving to consumers making New Year's resolutions to start building up their savings.

It added that it may also be due to the rise in VAT at the beginning of this year, which could have caused people to spend less money, leaving them with more spare cash to save.

Andy Hutchinson, head of savings at Nationwide, said: "Although there is still a lot of room for improvement, it is nonetheless encouraging to see a rise in the number of savers in January 2010.

"This is despite the continued low interest rate environment – the last time there were so many savers, the Bank of England base rate was 5.00 per cent.

"I think this shows that good returns are still available, especially for those who are willing to lock part of their savings into longer term bonds."

The rise in the number of people setting aside money helped to push up the group's savings index by two points to 85.

Mr Hutchinson said: "Although the Bank of England base rate has been very low for the past year, real returns on savings were relatively high in that period, once inflation has been taken into account.

"However, the most recent figures from the Office for National Statistics show that the annual rate of inflation has risen, which, if it continues, may threaten the long term real rate of return on savings."