Over 14 million* UK adults view their monthly savings contributions as an “essential outgoing”, finds Gatehouse Bank
Gatehouse Bank, the Shariah-compliant challenger bank, has published research indicating that over a third (35%) of UK adults – equating to over 14 million* people – consider their monthly savings to be an essential outgoing.
The research looked at UK adults’ attitudes to money, asking respondents to identify as either a saver or a spender in terms of their mindsets around money. The survey revealed the increasing importance of saving, even amongst those who considered themselves to be spenders, with eight in 10 respondents (82%) making monthly savings contributions. To meet their savings goals, UK adults are spending less on some of their milestone moments such as travel, household renovations and weddings.
The main motivation for the increasing focus on saving was concern for the future, with nearly eight in 10 savers (78%) and seven in 10 spenders (70%) identifying the pandemic and cost-of-living crisis as barriers to achieving their savings goals.
However, the approach to financial security varied across generations. 45% of savers and 31% of spenders aged 55-60 noted that they would need to have enough income to cover essentials, savings and nice-to-haves in order to feel financially secure. This was in stark contrast to just 16% of savers and 14% of spenders aged 18-24 who said the same.
Similarly, almost a fifth (18%) of 18-24-year-olds said they would feel financially secure if their income covered their essential outgoings, but this does not leave room for any unforeseen one-off costs. A further 18% of the youngest respondents said they did not know what financial security meant to them, demonstrating that there is still work to be done when it comes to financial education for young savers.
Ravi Kumar, Senior Product Manager at Gatehouse Bank, commented: “The data indicates a promising increase in those who focus on saving, but the generational gap regarding financial security remains. This is no fault of younger generations, and with the vast majority ready to learn from those close to them – over three quarters (78%) of those aged 18 – 24 said they were influenced by their friends and family – there is clearly scope to develop healthy savings habits amongst this age group.
“The role of family members in encouraging positive habits is obvious, but the work does not stop with them. Financial organisations need to continue guiding young people to make sensible financial decisions to meet their short-term and long-term goals. As a founding signatory to the UN Principles for Responsible Banking, Gatehouse Bank has set targets around financial health and inclusion, and we are piloting a financial education programme, to be distributed more widely at the end of this year.
“We also look forward to launching our Regular Saver product later this year, which aims to encourage our younger customers to set financial goals, build up healthy savings habits and bolster their financial resilience in the long run.”
This survey was commissioned by Gatehouse Bank and carried out by 3Gem. The research anonymously surveyed 1,000 nationally representative UK adults between the ages of 18 and 60 between 21st – 23rd August 2023. The research assessed respondents’ attitudes towards saving, asking them to identify as either a saver or a spender, with subsequent questions analysing the rationale behind this approach to money.
*The 14 million headline figure is based on nationally representative insights from Gatehouse Bank’s Savers vs Spenders research. 35% of the survey sample said they viewed their savings as an essential monthly outgoing. The research extrapolated this figure to reflect the number of adults between the ages of 18 and 60 in the UK as calculated by the ONS and Ibis, i.e. 35% of 40.5 million.