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Savings Ratio Hits New Low

Perhaps it is the effect of climate change but savers don’t seem to be putting aside as much for a rainy day as they used to! Figures released by the Office for National Statistics (ONS) have revealed that in the first quarter of 2017 the UK savings ratio has fallen to the lowest level since records began in 1963.

At 1.7% the ratio, which measures the percentage of household income which is put aside as savings, beat the previous low of 3.3% which was seen in the fourth quarter 2016. The ONS has commented that the timing of tax payments in the first quarter has contributed to the fall but nevertheless the underlying trend is still downwards. This has given rise to a number of concerns about whether people will have a financial cushion which they may need to fall back on; interestingly some commentators have highlighted the fact that savings ratios tend to fall in times of apparent financial strength, rising again in times of uncertainty as people cut back on spending.

If you’re looking for pensions or investment advice, or if your situation has changed and you may therefore need to review your existing investments, contact Beckworth by using one of the links on our website.