Over a third of Brits never compare their savings interest rate to others available, and risk missing out on £1,136¹ extra income a year

• Over a third (34%) hold most of their savings in a current account.

• One in seven (15%) UK adults have no savings at all – equating to 7.9 million people without a safety net.

• Over a third (36%) of adults with no savings are confident they could start a regular savings habit.

• UK Savings Week 2023 runs from 18th to 24th September. Head to www.uksavingsweek.co.uk/takethesavingschallenge to get involved in this year’s savings challenge.

As this year’s UK Savings Week begins, new research from the Building Societies Association (BSA)² has found that, despite the recent focus on interest rates, over a third (34%) of UK savers never compare the rate on their savings accounts to others available in the market – potentially missing out on more than £1,000 extra income. In addition, three in 10 (30%) revealed they never check what their rates are with their own bank or building society, with many Brits potentially missing out on free money by holding their savings in accounts offering paltry rates.

Brits opt for ad-hoc savings approach

There are also other savings habits that are preventing people’s savings from working as hard as possible.  The research found that over a third (34%) of consumers hold most of their savings in a current account, which offers little or no interest, and almost one in 10 (9%) savers haven’t reviewed their accounts for a year or more.

An ad-hoc approach to saving is popular among Brits, with a third (33%) of savers putting money aside whenever they can, and 34% saving whatever they can afford at the end of the month.

Of those who do have savings, the average amount set aside is £21,840, though more than half (52%) of people have less than £12,000.

Building a habit

Concerningly, a considerable proportion of Brits do not have a savings pot (15%) – equating to 7.9 million people. Yet, despite this, and against the backdrop of the cost of living crisis, over a third (36%) of adults with no savings are confident they could start a regular savings habit, putting away at least £10 per month.

Meanwhile, around four-fifths (79%) of those who do save, feel confident that they could save an extra £120 a year on top of what they currently save. Over half (51%) believe that they could manage an extra £600, while more than third (36%) believe they could confidently save £1,200 more a year.

Iona Bain, financial commentator and founder of Young Money, commented:

“Over the last decade, we've become used to stagnant interest rates offering little return on our savings. But now, we're seeing successive base rate hikes. It is a double-edged sword of course, but while households grapple with higher mortgage rates and increased living costs as a result, there is a silver lining in the form of significantly higher savings rates.

"Even if you feel like you can’t set any more aside at the moment, the BSA's research shows that reviewing where you're holding your existing savings can make a real difference; savers could potentially pocket over £1,000 just by shopping around for better rates. While we are all feeling the pinch, it's all about saving smart, in a way that works for you. Selling unwanted clothes and unused electronics can also boost your savings with relatively low effort and little time commitment, while uninstalling shopping apps can be a great way to remove the temptation to spend.

“No matter how big or small the amount, saving regularly will help you take control of your finances and the UK Savings Week Challenge will offer encouragement and reward you for making saving a habit."

Robin Fieth, Chief Executive of the BSA, said:

“Despite lots of media and government attention on savings rates following the significant increases in the Bank Rate, it’s perhaps surprising that the level of engagement people have with their personal finances remains fairly low. As savings rates have been increasing over recent months, shopping around can now make a sizeable difference to the returns available.
“It’s encouraging that many of those who currently do not have any savings are confident they can start saving every month, and there are lots of different savings accounts available for all levels of savers.

“Every small contribution made to a savings pot can go a long way, but the key to this is starting a savings habit. We all know life gets in the way, and savings, understandably, can slip down the priority list. But taking the thought out of saving and putting away a set amount at the start of each month – for however much you can comfortably afford – can be a great way to make it a habit and achieve your savings goals.”

The UK Savings Week Challenge

This year, UK Savings Week is launching a savings challenge and inviting the nation to get involved by following three simple steps:

1. Set a goal – encouraging people to review their finances and set a target amount to save each month

2. Make it a habit – take it off your to do list by setting up a monthly payment into a savings account

3. Reward yourself – rewards don’t need to be complicated, but they are crucial in helping people to stay motivated. UK Savings Week will provide monthly tips, as well as free and exclusive lifestyle content, so that you can make saving a genuinely happy habit

Robin continued: “We’ve launched the UK Savings Week challenge to encourage the nation to make savings a habit. We know the key to habit formation is rewards, so people who sign up for the challenge will receive exclusive monthly rewards content from our UK Savings Week Ambassadors, who we are delighted to welcome on board this year.”

UK Savings Week Ambassadors include Olympian Max Whitlock and Great British Bake Off Star Benjamina Ebuehi, among others. Ambassadors will provide exclusive rewards content for those who sign up www.uksavingsweek.co.uk/takethesavingschallenge to take the challenge, delivered straight to their inbox every month for the next year.

-ENDS-

¹Based on mean balance of £21,841 earning the current best-buy easy access account rate of 5.2% (Source: Moneyfacts 5 September 2023) for a year compared to no interest in a current account.

²Research conducted by Opinium on behalf of Building Societies Association via to online surveys:

• Between 23 – 27 June 2023 with a nationally represented sample of 2,000 UK Adults
• On 21 June 2023 with a nationally represented sample of 2,000 UK Adults

About UK Savings Week

UK Savings Week is an annual campaign to get people engaged in saving. It has been introduced through the collaboration of several building societies, credit unions and other providers, as well as consumer groups and debt charities. This year's campaign will run from 18 to 24 September 2023.
 
UK Savings Week aims to raise awareness of the importance and benefits of saving, and to encourage people to foster better savings habits. It has no commercial intentions and it won’t promote specific savings accounts or providers.
 
We expect that each year more organisations will get involved in UK Savings Week, using it as a focal point for amplifying consumer engagement and support around savings.