The Bradford & Bingley savings report reveals there is still no sign that the well documented 27bn per annum savings gap is closing.
B&B say many are simply not saving at all and those that are saving are not saving enough. This, combined with the current deficiencies in state pension provision, means millions will be facing an uncertain future.
Only 36% of 30 to 50 year olds and 40% of over 50s are saving regularly and of those only around 15% are managing to save over 300 a month. A third of 30 to 50 year olds and a quarter of over 50s say they dont spend much on luxuries but simply dont have any spare cash to save.
Steve Potter, head of savings at Bradford & Bingley, says: “The Turner Report has again highlighted the pension problem in the UK. What has also become clear though in our research, is that large numbers are still failing to save regularly many citing the lack of cash as the reason they arent doing so. This disparity between what they should be saving and what they are managing to put away will undoubtedly mean many people will be facing the future with apprehension and even dread.”
The research findings also reveal those who are saving are saving primarily for the short term for such things as rainy day funds, holidays, home improvements and household items such as plasma TVs.
Saving for retirement, however, falls down the priority list. Only one in five of 30-50 year olds and a third of over 50s are saving for retirement (excluding pensions).
Potter adds: “The Turner Commission Report has sought to deal with some of the current inadequacies in pension provision, however, it will clearly not be the panacea for all. By leaving our retirement planning late, we are effectively storing up a suspended sentence to serve time on the breadline. If people want to be able to live life to the full in old age, their savings habits have got to change. Making provision sooner rather than later really will make a difference.”