Families too stretched to save says Aviva

Posted on January 23rd, 2011 | Categories - Savings

Families failing to save due to debt repayments and lifestyle expenses.

Savings levels are low amongst families marred by the cost of living.

A third of families have no savings at all, according to an Aviva report.

The insurer found that although there are many Britons who are surviving through the post recession climate there are others who are struggling. It’s research highlighted that 40% of people are unable to make any monthly savings due to debt repayments and the rising cost of living. Even among the families that are able to save, 25% have savings of less than £2000.

The report outlined that over half of families living in the UK are worried about the cost of necessities with 45% concerned about redundancies and 39% anxious about unexpected expenses.

Mortgage repayments were found to be the largest single expenditure for almost two thirds of families making up 20% of their monthly outgoings. It was also highlighted that the average family has a debt of £5,360 rung up on credit cards, loans and overdrafts. However, single parents were the most likely to be free of debt.

Louise Colley, head of protection marketing at Aviva said: “This report gives us an interesting insight into the financial issues facing modern families in the UK. Not surprisingly, in today’s society, some families are struggling to make ends meet and 39% feel they cannot take on any additional financial obligations. While it is encouraging to see that most families are trying to save something every month, it is clear that other demands on their finances mean this amount remains below what is needed to guarantee a secure financial future”.