Caught in a Financial Storm: A Shocking 10% of Brits Have Zero Savings!
A recent report by the Financial Conduct Authority (FCA) has revealed that one in ten UK adults have no savings at all, leaving them vulnerable to economic shocks and rising living costs. This lack of financial resilience is alarming, particularly amidst the ongoing cost of living crisis. Over 13 million people in the UK are struggling with low financial resilience, characterized by unmanageable debts, negligible savings, and missed bill payments. This reflects a stagnant situation compared to the 2022 survey results, despite rising inflation and essential expenses.
The survey highlights that 10% of respondents have no savings, while 21% have less than £1,000 saved. Key findings reveal:
2.8 million individuals have persistent credit card debt.
Nearly 12 million feel overwhelmed by financial matters.
40% of borrowers express anxiety related to their finances.
3.8 million retirees are worried about their financial futures.
Additionally, the report points to an increasing reliance on buy now, pay later services, particularly among lone parents and young women, raising concerns since these products remain unregulated. The report estimates that nearly half of adults carry unsecured debt, with a median debt level of £6,300, which rises significantly among younger adults.
The FCA indicates that mental health issues often correlate with financial stress, and free debt advice services are available without affecting credit scores. Matt Dronfield, managing director of Debt Free Advice, emphasizes the courage it takes to seek help and encourages proactive financial habits, such as setting aside a small amount for savings first after receiving income. The average savings among individuals are noted to be between £5,000 to £6,000.
As financial strains become more prevalent, the need for support and prudent financial planning becomes ever more crucial.