One of the biggest problems with the advice and guidance on how to deal with losing a job or when you are facing financial difficulty is that the advice is out of touch with so many people. It is very difficult to provide a single piece of information and hope that people can act on it at the best of times but with so many variations on finances and what people feel confident in, there is virtually no way there can be a universal agreement on how long a person’s savings can last. In fact, instead of asking “how long would your savings last?” you could be as well asking “how long is a piece of string?”
Of course, this is an area of great interest for many people and there has been a recent study into this issue by the Legal & General, a well-known insurance company. The firm spoke to 2,000 people and the common consensus of the response was people would be able to last 32 days on their savings. This means that people only have a back-up of a month, which is certainly a worrying trend. There is also the fact that this is the average which means that a considerable number of people in the country have much less of a safety net if anything was to go wrong.
A lot of people are concerned about savings
The same study found that 26% of people said their savings would run out in a week or less time while 23% of respondents said that they had absolutely nothing that they could fall back. This means nearly a quarter of respondents said that they have absolutely no back up plan or no Plan B if problems arise with their finances. This is a very worrying trend and as a spokesperson for the company said; “The UK still clearly suffers from a savings and protection gap.”
22% of respondents said that they had a sum that was less than £500 in their savings account. This is the sort of comment that will leave many people incredulous at what people are doing with their money but the sad state of affairs is that there are many people across the country who are not in a position to have savings. There are people who rarely have any money left after they have paid their bills and of course, there are people who are scrambling about to pay their bills on a monthly basis. One of the biggest issues in the United Kingdom comes with the disparity of wealth and finances. There are many people who have no clue or idea about the hardship being experienced by some people in the same country or perhaps even same town or city as them.
Financial advisers have big plans for savings
If you were to ask a financial adviser what sort of savings you should have put aside in case of emergencies, they will tell you that a minimum of three months’ worth of income or salary is the recommended amount. This is a sum of money that many people are unable to contemplate saving because there are so many current demands on their finances.
In the study, the term “deadline to the breadline” was used and there were regional variations for how long people thought their savings would be able to last. The longest time stated in the study came from Northern Ireland with people saying that they expected their savings to last them for 36 days. This can be contrasted with the state of affairs in Wales with the average time stated by respondents being 26 days, which led to Wales being the UK location with the shortest time period before money ran out.
The findings ran:
- Wales – savings expected to last 26 days
- South East of England – savings expected to last 29 days
- Scotland – savings expected to last 31days
- London – savings expected to last 31 days
- South West England – savings expected to last 32 days
- North East England – savings expected to last 33 days
- North West England – savings expected to last 33 days
- Yorkshire and the Humber – savings expected to last 34 days
- East Midlands– savings expected to last 34 days
- West Midlands– savings expected to last 34 days
- Eastern England – savings expected to last 35 days
- Northern Ireland – savings expected to last 36 days
This is why finding short term solutions or ways to bridge the gap can be helpful, and a guarantor loan may be of benefit. If someone is willing to support your application, and they have a good credit score, there is a good chance you can obtain an affordable loan to tide you over a difficult period.
When it comes to savings, many people are realising that they don’t have sufficient funds to take care of themselves.
Andrew Reilly is a freelance writer with a focus on news stories and consumer interest articles. He has been writing professionally for 9 years but has been writing for as long as he can care to remember. When Andrew isn't sat behind a laptop or researching a story, he will be found watching a gig or a game of football.
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