One-third (33%) of adults in Yorkshire and Humberside set money aside every month to pay for basic needs like utility bills or household repairs, the same figure as across the UK, according to new research by ComRes and insolvency trade body R3.
One in twenty (5%) of the region’s adults set money aside for these necessities every week, compared with the national average of 8%.
The survey, the latest in a long-running survey of over 2,000 British adults, also found that one-third (36%) of adults in the region are putting money away for ‘a rainy day’ every month, one quarter (25%) are saving for luxury items monthly, and 16% are saving for retirement every month. These figures are in line with the national picture.
Adrian Berry, chair of R3 in Yorkshire and restructuring partner at Deloitte LLP, said: “It is troubling that a third of the population have to regularly set money aside to pay for basics, but at least they are planning ahead. Around a third of British adults make no regular contribution to their savings, while two-thirds make no contribution towards their retirement.
“The survey also shows that most people are likely to save regularly for retirement in the few years before they retire; very few start saving early. Across Great Britain 46% of 55-64 year olds save for their retirement compared to just 35% of 25-34 year olds or 22% of 18-24 year olds. Hopefully, the new auto-enrolment pension scheme could change this.”
Mr Berry added: “Low inflation will help individuals’ incomes stretch further and allow people to put a bit more money away at the end of the month. An improving economy is the time people should be paying down debts or rebuilding their savings. This can give people a bit of breathing space when the economy slows down again.”
Two-thirds (68%) of Yorkshire and Humberside’s adults say they put money aside for ‘a rainy day’ at least once during the last year, 62%put money aside for necessities at least once, 59% put money aside for luxuries at least once, and one-third (35%) put money aside for retirement at least once during the last year.
R3 and ComRes’ research also found that adults in Yorkshire and Humber are generally good at keeping an eye on their finances:
- 61% check their current account balance every week; 20% check every day;
- 33% go through their recent spending by checking receipts every week; 22% check every month;
- 15% make a budget weekly; 22% make a budget monthly, while 24% never make a budget for their household finances
- 23% have ever hit the overdraft limit on their current account
- 18% have ever received a penalty charge for late payment of a bill
- 17% have ever reached the borrowing limit on a credit card.
Mr Berry explained: “Smart phones and online banking have made it much easier for people to keep on top of their finances. This does make it easier to prevent spending from getting out of control. There is a big difference, however, between making budgets and sticking to them.
“Encouragingly, people with debt worries are most likely to actively track their finances. This could help prevent problems from getting worse. 85% of people who are extremely worried about their debts check their balances at least weekly, compared to 79% of people with no debt worries. 42% of people who are extremely worried about their debts make a budget at least weekly compared to just 16% of those without debt worries.”
The research also found that across Great Britain:
- Women (81%) are more likely than men (76%) to have ever made a budget for their household finances
- Women (33%) are less likely to have ever put money aside for retirement than men (38%) or to have put money aside for a rainy day (women: 67%; men: 72%);
- 89% of those aged 55+ have never reached the overdraft limit on one of their current accounts, while 65% of those aged 18-44 have never reached their limit;
- 91% of those aged 55+ have never reached the borrowing limit on a credit card compared to 73% of those aged 18-44;
- 88% of those aged 55+ have never received a late payment charge for a bill compared to 68% of 18-44 year olds;
- Those aged 18-24 (76%) and 65+ (72%) are the least likely to say they ever make a budget for their household finances (35-44 year olds are most likely to ever budget for this: 85%).
Mr Berry said: “Younger people are more likely to hit borrowing limits, but they are not particularly worse than others when it comes to planning. This is down to two factors: on the one hand, younger people have less financial room for manoeuvre than older generations do; and on the other, they tend to have a more relaxed attitude to debt. Getting into debt seems to be part and parcel for financial planning for younger generations.”