Benefits of saving continuing to fall

Nearly three-quarters of consumers feel that the benefits of saving have fallen over the last year, according to research by the ABI (Association of British Insurers).

The research highlights the need for a new savings culture in Britain, as consumer pessimism on the benefits of saving continues to grow.

The ABI's Savings and Protection survey of 3,000 adults carried out by YouGov shows that during the last quarter of 2008:

The attraction of saving continued to fall. Only 7% felt that the benefits of saving had risen over the past year, compared to 15% in the same survey in the third quarter of 2008.

Nearly three-quarters (73%) of consumers felt that the benefits of saving had fallen over the last year, compared to just over half (53%) in the third quarter.

Consumer confidence in the economy remained low: 7 out of 10 people believe that the UK economy will deteriorate further during 2009.

Dr Rebecca Driver, the ABI's Director of Research and Chief Economist, said: "The current economic climate vividly highlights the dangers of too much debt - the country needs to develop a healthier approach to saving. Yet our research shows that consumers are becoming increasingly sceptical about the benefits of saving. Increasing ISA limits and bringing forward automatic enrolment into existing workplace pension schemes will help, and we urge the Government to take action on these issues".