Scots not saving enough for their future

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MORE than a million people in Scotland are not making any effort to save, according to a report.

The Scottish Widows savings and investment report said 20 per cent of its respondents have no savings at all, while 1.4 million people – a third of the country’s adults – are not putting anything away.

Of the 63 per cent who are managing to save, more than a third (35 per cent) have notched up less than £1,000. Scottish Widows said this amount “barely covers” the average combined monthly cost of mortgage and council tax payments (£870).

The investment company said the report shows a “bleak picture” of people’s ability to cope with potential financial shocks.

The report also found that 29 per cent of respondents with families have loaned “a substantial amount” to their children, often to help them meet daily living expenses.

Support is also provided for higher education and property purchases, with parents giving an average loan of almost £14,000, the annual report said.

The majority of parents who answered (64 per cent) opted to help their children get on the housing ladder, while 21 per cent said they would prefer to contribute to university fees.

More than a fifth (21 per cent) of those lending money have had to cut back on their own savings, while 6 per cent said they have stopped saving.

Scottish Widows said families are pulling together, as the report showed the average grandparents in Scotland have lent £700 to their grandchildren and 9 per cent of people have lent an average £1,477 to a sibling.

More than a quarter (28 per cent) said they have been forced to cut back on their savings by rising costs, and a further quarter are saving less than two years ago, due to less disposable income.

The majority (63 per cent) said that having no money available is a barrier to saving.