Level of savings slips as people live through a challenging year

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SAVERS in Yorkshire and North Lincolnshire have faced a challenging year, according to new research from NS&I.

While average pay in the region rose by £119 since spring 2011, the amount people saved fell by £3 from £96 in spring 2011 to £93 in the winter of 2011 to 2012.

Average savings as a percentage of income declined from 8.27 per cent in the spring of 2011 to 7.28 per cent this winter. This is less than the national average of 7.66 per cent.

The research also discovered that 37 per cent of people in Yorkshire and the Humber with a “savings goal” are putting cash to one side for a special occasion like a holiday.

One third (33 per cent) are making home-related savings and 28 per cent of people are saving in case of an emergency.

As many as 28 per cent of people are saving for retirement, compared to a national average of less than a fifth (19 per cent).

John Prout, NS&I retail director, said “While many people found saving a challenge last year, our data shows that there has been an improvement in recent months.

“With saving reaching its highest levels since spring 2011, it appears that people are taking action and committing to setting more money aside for the future.”

Women appear to be almost entirely responsible for this increase.

On average, women are now putting away 8.38 per cent of their incomes, compared to 7.54 per cent in autumn 2011.

This represents an increase of 0.84 per centage points in savings levels quarter on quarter.

By contrast, the savings rate of men is almost unchanged. According to NS&I, men put away 7.21 per cent of their incomes, compared to 7.20 per cent in autumn 2011.

Mr Prout said: “Our research shows that savers who set specific goals stand to reap the rewards. Setting an objective is a great way to keep focus, even if you only save a small amount towards it each month.

“Many of us could be doing a lot more to manage our money better and it’s never too late to look again at your finances. Why not use the new financial year in April to act as motivation to improve your savings?”

NS&I is one of the UK’s largest financial providers with around 26m customers and more than £100bn invested.

All the products are backed by HM Treasury.