As many people across the UK experience health and financial challenges like never before, new data from protection and health insurer The Exeter has revealed that 40% of workers over 18 are saving less than £100 in a typical month, with one in seven (14%) unable to save anything.
The Exeter has launched its latest research, Challenging Times: The health and financial fears of UK workers, examining the range of concerns employed and self-employed adults have regarding their health and financial security.
Older generations save less
When asked about how much they could afford to save in a typical month, 20% of those aged 45-54 and 19% aged 55-64 reported that they saved nothing at all, the highest proportion of any demographic. This is particularly worrying given that these age groups are closest to retirement and lack many options available to younger generations to secure a higher income.
Respondents in London were most likely to save more than £100 in a typical month, with only 20% saving less than this.
Conversely, almost half of respondents in Yorkshire (47%) and East England (45%) reported saving less than £100 – over twice that of Londoners.
Significant concerns as the impact of increased living costs take hold
The Cost of Living Crisis is clearly impacting consumer behaviour, with 81% of the working population reporting that they have changed their spending habits because of rises in energy prices, inflation, and national insurance.
More than half (52%) of respondents were concerned about being able to pay for food or utility bills, and 44% were worried about keeping up with rent or mortgage repayments.
When it comes to cutting back on expenses, 49% are spending less on the weekly shop, 44% are reducing their utility usage, and 41% are spending less on leisure and entertainment.
65% of people reported that they were worried about not saving as much as they would like each month highlighting that the importance of having a financial safety net is not lost on UK workers.
The challenge, however, remains that as the cost-of-living increases further, people’s ability to save will likely reduce.
Isobel Langton, chief executive at The Exeter, said: “We wanted this research to examine the many pressures working people in the UK are dealing with, but the level of financial and health fears we have uncovered has revealed the true scope of the challenges they face.
“With so many people in the UK worried about saving enough and, with living costs continuing to rise, the speed at which someone can fall into debt could also increase.
“While there are helpful financial guides and tools available, for example from the Government, we need to ask ourselves what more we can do to help people weather this storm.
“Arguably the financial services community is best placed to provide advice and support. From insurers and financial advisers to mortgage lenders, finance influencers, and savings experts – we each have a role to play.
“Within our individual businesses and collectively as an industry, we must come together and collaborate to ensure that we provide the best possible outcomes to help guide people through the challenges they face.”
Reaction
Phil Jeynes, director of corporate strategy, Reassured:
“The rising cost of living is making it harder than ever for people to save any of their monthly income.
“People are now looking at their expenditures and evaluating what is a necessity versus a luxury and where they can cut costs. It is important that life insurance is viewed as an essential outgoing on par with things such as mortgage payments.
“Cancelling your policy could leave your family’s financial circumstances in a much more precarious situation should you die or become seriously ill.
“If you are considering cancelling your policy to cut down on outgoings, it might be helpful to know that most insurers can offer flexibility to customers via temporary payment breaks or short-term reductions in cover, so before making any decisions, speak to your insurer or broker to assess your options to remain protected.”
