Many turn to savings for financial support in difficult times

Many consumers and households have seen their finances become more and more difficult to manage over recent months as rising living costs, higher bills, and the effects of the global credit crunch have all taken their toll on budgets, putting our finances under real strain. A recent report has shown that many people have had to turn to raiding their savings in order to cope financially.

With food prices, petrol prices, energy cost, and inflation all have rocketed over recent months, research has shown that consumers have, one average, raided around £434 from their savings accounts over the past three months. Industry officials have said that over the coming three months consumers may need to find around 16% more cash to cope with increased living costs.

The amount of money per person that was withdrawn on average over the past three months reflected a rise of 7% compared to the same period last year. Some people said they had to raid savings to pay unexpected bills, others withdrew the money for a holiday, and some withdrew the money due to unforeseen circumstances.

One official said that people were still managing to save money even in the current climate, stating: ‘We appreciate that in today’s financial climate, it is proving extremely difficult to put money aside as people are having to spend more on their day to day living costs. However the fact that people are still managing to put significant amounts of money into savings is an encouraging sign for the times ahead.’