Savings at their highest for a year
Monthly saving levels are at their highest for the first time since last year, according to a new survey.
Not only are savings up on the previous quarter but they have reached more than £100 a month for the first time in a year, according to the NS&I’s Quarterly Savings Survey.
People are now saving on average 8.04% of their income each month - £101 in monetary terms. And women have overtaken men for the first time in a year, saving 8.36% of their income compared with 7.84% for men.
When it comes to not putting anything away for a rainy day, 18% of women are not saving anything – but the number is down from 23% this time last year. A similar amount of men are not saving any money - up from 17% last year.
Perhaps because they have fewer responsibilities such as mortgages to pay, the youngest age group is managing to save more. Those in the 16 to 24 age group saved 9.05% of their income in the winter of 2013. Meanwhile, 45 to 54 year olds were the worst performers, only saving 6.42% of their income in the same period.
The overall amount saved in winter 2013 represents the third in four where savings levels reached above 8%. It is also the fourth year in a row when savings have gone up in winter, as compared to autumn. In autumn 2013, the percentage of average income saved was 7.76% (£98) - £3 less than in winter 2013.
Invidivual Savings Accounts were introduced on 6 April 1999 to replace personal equity plans (PEPs) and tax-exempt special savings accounts (TESSAs) with one plan that covered both stockmarket and savings products, the returns from which are tax-exempt. The ISA is not in itself an investment product. Rather, it’s a tax-free “wrapper” in which you place investments and savings up to a specified annual allowance where the returns (capital growth, dividends, interest) are tax-exempt (you don’t have to declare ISAs and their contents on your tax return). However, any dividends are taxed within the investment, and that can’t be reclaimed.