27 April 2011
London, 27 April 2011: 53 percent of UK adults are set to continue current savings levels or increase their saving in 2011, according to new research conducted by YouGov on behalf of Brewin Dolphin, the UK’s leading private client investment managers. This positive message comes at a time when British households’ income is being squeezed by prevailing economic conditions – 84 percent of respondents think they will be affected by factors such as inflation and public sector spending cuts.
The Nation’s Personal Finance MOT was conducted to gauge the extent of the UK’s financial knowledge and personal finance behaviour. The 2000 plus respondents demonstrated an astute knowledge of financial terms, with over 80 percent being able to pick the correct definitions given for stagflation (86%), CGT (89%), income tax thresholds (89%), inflation (87%) and ISAs (84%). Over half correctly guessed gilts (54%) and unit trusts (54%). Respondents were slightly woollier around hedge funds (31%) and derivatives (35%). 92 percent knew the current VAT rate and just under a third (32%) correctly identified the basic rate tax threshold of £35,000.
Good saving and investment behaviour amongst UK adults was further demonstrated by the fact that 82 percent of people have savings and investment products, with savings accounts (61 percent), pensions (54 percent) and ISAs (49 percent) being the most popular vehicles. Over a fifth (21 percent) have investments in the stock market or funds.
A likely precipitator of this uplift in financial awareness and good saving and investment behaviour is the credit crunch, as 57 percent of respondents said it caused them to review or change their own personal finance situations. 27 percent are more concerned about savings since the downturn and it has caused 26 percent to focus on paying off their debts.
Financial prospects post retirement is still a worry for over half of respondents (53%), although 43 percent are not worried at all or not very worried. Generation X is the most worried about their financial situation in retirement with 62 percent of 35 to 54 year olds demonstrating concern.
Discussing the results, Charlotte Black, Head of Corporate Affairs at Brewin Dolphin commented: “Taking the temperature of the Nation’s personal finance knowledge and behaviour has identified some interesting trends. The commitment to saving and investment is heartening, given the fact that so many UK households are having their income dented by inflation and salary freezes. The results focusing on financial knowledge were much better than we had predicted – it is likely the banking crisis has had a positive impact on people’s knowledge of financial jargon. It has spurred them on to become more aware. However, it is evident that people are worried about their financial future, particularly post retirement – we are calling on those to get advice on what they need to be doing to safeguard their futures.”
Key findings from the research include:
- 84 percent felt they would be affected by current economic conditions, such as inflation
- 18 – 24 year olds proved to be the most committed savers with 38 percent planning to save more in 2011 than they did in 2010
- 53 percent are planning to save the same or more in 2011, whilst 38 percent plan to save less
- Savings accounts are the most popular savings vehicle (61 percent), pensions come second (54 percent) and a significant 49 percent of respondents take advantage of tax free ISAs
- Since the credit crunch, 27 percent are more concerned about saving and 26 percent are focused on paying off debts
Notes to Editors
All figures, unless otherwise stated, are from YouGov Plc.Total sample size was 2140 adults. Fieldwork was undertaken between 25th to 28th February 2011.The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+).
The Brewin Dolphin Group manages over £23 billion of funds for over 130,000 private clients and of this £14 billion is on a discretionary basis. BD has 41 offices throughout the UK and Channel Islands and Brewin Dolphin Corporate Advisory and Broking is adviser to 90 small and medium size quoted companies and institutions.
Brewin Dolphin Limited (“BD”) is the principal operating company of Brewin Dolphin Holdings PLC. BD is authorised and regulated by the Financial Services Authority and is a member of the London Stock Exchange.
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In 2010 Brewin Dolphin won Citywire’s Large Firm Adviser Choice Award and the Research department won the Investment Week Award for best discretionary research. The Brewin Dolphin Group was named Best Discretionary Broker in the Shares Awards 2009 and also received the top awards for its Market Newsletter and Exceptional Performance in Business Support at The Daily Telegraph wealth management awards in 2009.
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