| According to research published by ING
Direct, the average amount saved by Britons was down
by 8% for the first quarter of 2010 to just £2,023,
even taking into account that a third of savings wealth
in the UK is held by the top 5% of the population.
These figures can be blamed on paying off the Christmas
excess, but it seems that saving is not easy for large
numbers of the population.
The results reveal, rather worryingly, that the
average person is only saving 1.6 times their monthly
salary, which doesn't leave much of a buffer to
fall back on in the event of unemployment or a pay
cut. Overall unemployment has increased and now
surpasses the 2.5 million figure, representing 8%
of the working population, and seeing as the average
unemployment period has increased to six months,
if you do become unemployed £2,023 isn't going
to last six months.
The other problem is the growing level of personal
debt the UK is facing. Right now Britain's interest
repayments on personal debt are £68.4 billion.
The average interest paid by each household on their
total debt is around £2,716 - considerably
more than the amount being saved - and according
to PWC the average household will need to spend
approximately 15% of their net income just servicing
the interest repayments arising from this debt.
However, more and more people want to save but
they can't do it alone and they are now asking for
help from the Government. Few people know about
the full benefits of the various savings accounts
on offer, one such example is ISAs. These were launched
by the government more than 10 years ago in an attempt
to encourage and help people to save. So what is
an ISA?
An ISA is an Individual Savings Account that allows
you to save a certain amount of money, currently
up to £10,200 in a tax-free interest account.
This means you don't have to pay any tax whatsoever
on any interest you earn. You can have two different
types of ISA: one in cash and the other in stocks
and shares. You can invest up to 50% in cash and
the remainder, or up to 100%, in stocks and shares.
Obviously cash is the safe option, but the interest
rates are usually lower so you have less chance
to profit big, although you don't have a chance
of losing either.
Once you have a job you need to start saving not
just spending. Visit Alliance & Leicester for
a variety of savings
options.
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