The ongoing cost of living crisis has been at the front of many people’s minds for many months now. Lots of us are being forced to consider everyday financial decisions more carefully while planning ahead with money more than ever before. Yet a new study by Leeds Building Society has found that 6 in 10 Brits are still putting away savings, while 61% have set savings goals for the year ahead.
Such habits can help us feel more in control of our lives. 19% of UK adults report that saving makes them feel empowered, while another 19% feel reassured by their growing funds. But not everyone is in the same boat, with 23% feeling anxious about saving money and 4% confused by the topic in general.
For those who are able to save, however, it’s possible that some of our priorities may have changed in the current climate. So what are Brits putting their money away for in 2023?
Financial experts often talk about the importance of putting money in savings accounts to help with unexpected expenses that could otherwise present challenges, known as saving for a rainy day.
Common examples of these unexpected costs include car and home repairs and vet bills, plus major surprises such as losing jobs. And with many adjusting to lower levels of disposable income right now, 23% of adults are wisely looking to save more for a rainy day.
Next up on our savings priorities are large expenses, with 14% currently saving for a specific purchase. This category commonly ranges from much-needed holidays to weddings, home deposits and new cars or bikes.
Rising inflation, bills and mortgage rates mean that many of us are having to save harder and longer for these higher-ticket purchases however, in some cases delaying major life events.
Paying off debt
While some credit is normal and manageable, for some people, a knock-on effect of the pandemic and cost of living crisis is needing to borrow more money. While a lucky 9% are saving more money in 2023 than before, many others are focused on repaying rising debts.
Doing so can reduce the amount of interest paid overall, as well as ease the mental burden of owing money. Common debts we struggle with include credit card spending, overdrafts and loans, as well as informal borrowing from friends and family.
While things can appear bleak, putting realistic plans in place and seeking free advice can help you feel more on top of your finances again.
Regardless of our priorities, the fact that most Brits are still able to save money in these times is encouraging. With signs of inflation slowly falling, it’s to be hoped that the financial outlook keeps improving.