Fretting about finances limits savings success
Brits who spend more of their time fretting about their finances rather than planning what to do with their money, are saving significantly less than those who concentrate on managing their money. "Worriers" set aside an average of just £53.47 a month, while "planners" save nearly double - £104.39. Over the course of a year planners are putting away over £600 in extra savings, more than enough to pay off the average gas and electricity bill for six months.
Currently, 41% of those who worry about their finances at least once a year spend more time worrying than planning what they should do with their money. While 10% of those who worry about their finances at least once a day, check their finances only once a month. This lack of action is having an impact beyond people's finances as 25% of people say they feel guilty when they overspend through lack of planning.
John Prout, NS&I Savings Spokesperson, said "Britons seem to be getting into a cycle of financial fret. Time is spent worrying instead of focusing on money management and finances suffer as a result, causing more stress. By planning ahead and taking active steps, we can take more control of our money and work towards saving. So if you're getting money worries, take some time out to review the situation and take action."
A group of Britons are taking proactive steps to manage their finances. Around a quarter (23%) of those who take active steps to check their finances regularly monitor different savings accounts to ensure they are getting a competitive interest rate. Similarly, 23% have a direct debit set up from their current account to a savings account. Almost two-fifths (17%) keep a daily diary of expenditure and 16% withdraw a set allowance of money each week from their bank account.
Furthermore, NS&I's research has found that among the quarter (25%) of Britons who don't worry about their finances at all, many have invested time to make their money go further. For example, 56% of this group of people use price comparison websites to find the best deal, 53% of them use vouchers and coupons to save cash and 53% prepare a packed lunch rather than buying it from a shop. Over a third (37%) of people who don't worry go to a selection of shops to compare prices before buying an item and a quarter (25%) take a more time-consuming but cheaper form of transport.
John Prout, NS&I Savings Spokesperson, continued "By taking the time to manage your finances and setting realistic budgets and savings goals, people can reduce their financial worry. If you have a good friend or family member who doesn't worry about their finances, why not ask them what works for them? It's also a good idea to set time aside to compare financial products, using tools from the Money Advice Service, to make sure you are getting the best deal. Taking simple steps like these will lead to larger savings pots, as well as less worry."
Further help and information on savings tips and personal finance are available at: moneyadviceservice.org.uk.