
Emergency fund: What it is and how to build one
This type of savings account can save you from a lot of financial stress and anxiety.
Read more…Whether you’d rather hide money under your mattress or more wisely put it into a savings account, savings are key to helping people plan their future, deal with accidents and secure a comfortable retirement. How much does the average person have saved in the UK? And are we getting better or worse?
We carried out some research in 2020 to find out who has savings, how much we have saved and to look into the reasons why many people don’t have savings.
During the lockdown in 2020/2021, Brits saved an average of £54.67 per week on leisure activities. Meanwhile, those working from home saved a further £44.78 per week by working from home (which included not having to pay for commuting or work lunches).
This equated to a total saving of £99.45 per person per week. Extrapolating those figures to the wider UK population means that Brits were making a staggering collective saving of £4.6 billion for each week of the lockdown. Given the duration of the lockdown in 2020 until 2021, that makes a running savings total of over £130 billion (the figure that would have been saved after 1 year of lockdown).
60% of the population said they were working from home at the start of the pandemic, equating to a whopping 89% of workers who would have saved some money. In a year, they would have saved an average of £2,330 each.
On top of this, with full lockdowns having been in place at the time, this means that individuals would have also saved by not socialising in any capacity, resulting in average savings of £1,420. When these figures are combined, people who worked from home could have saved £3,750 over the year.
Percentage that will save | Average savings | Total savings per week | Average savings over 3 weeks | Total savings over year of lockdown | |
---|---|---|---|---|---|
Leisure activities | 87.90% | £54.67 | £2,518,239,028 | £164.01 | £65,474,214,720 |
Working | 53.20% | £44.78 | £2,098,155,913 | £134.34 | £64,916,943,935 |
Total | £99.45 | £4,616,394,940 | £298.35 | £130,391,158,655 |
Out of all the generations, baby boomers (born 1946–1964) have the most saved, with an average of £9,758.54 per person. The second-highest savings are with the silent generation (born 1928–1945), who are sitting on an average of £9,497.96 per person.
The youngest generation, gen Z (born after 1996), who have been working the shortest amount of time, have the smallest savings balance, with just £2,530.71 on average.
Those aged 22–29 are the least likely to save, with 53% of them having no savings at all.
Generation | Average current savings |
---|---|
Generation Z (Born after 1996) | £2,530.71 |
Millennials (Born 1981-1996) | £4,614.04 |
Generation X (Born 1965-1980) | £6,160.57 |
Baby boomers (Born 1946-1964) | £9,758.54 |
Silent generation (Born 1928-1945) | £9,497.96 |
An ISA (individual savings account) is the most popular type of savings account, thanks to its tax-free benefits. But how many Brits are taking advantage of these tax-free savings accounts, whether in the form of a cash ISA or a stocks and shares ISA?
If you’re not familiar with stocks and shares ISAs, they’re savings accounts that allow you to invest in stocks and shares, usually based on the level of risk that you are comfortable with. If you want to know more, we’ve compiled a list of the best trading apps to help you decide which is best for you.
Cash ISAs have become less popular over the years from 2015 to 2018, while stocks and shares ISAs have become more popular. However, this trend reversed in 2019. Read on to find out more about the changes in adult ISAs in the UK.
The total number of ISAs has seen a resurgence in recent years. Over 2020, the number of ISAs has increased to 12.43 million, this is 1.27 million more than in 2019. There are over 9.7 million cash ISAs and this is 1.22 million more than in 2019. There was also an increase of 310,000 more stocks and shares ISAs in 2020, with 2.73 million accounts open in 2020. Explore the graph below to find out more about adult ISAs.
Year | Cash ISAs | Stocks and shares ISAs | Total |
---|---|---|---|
2015/2016 | 10.12 million | 2.54 million | 12.66 million |
2016/2017 | 8.48 million | 2.59 million | 11.07 million |
2017/2018 | 7.78 million | 2.84 million | 10.09 million |
2018/2019 | 8.48 million | 2.42 million | 11.16 million |
2019/2020 | 9.70 million | 2.73 million | 12.43 million |
In 2019/2020 the total amount subscribed to cash ISAs increased by 7.4% to £73 billion. The growing number of cash ISAs in 2020 also caused the total amount invested in cash ISAs to spike from £44 billion in 2018/2019 to just under £49 billion in 2019/2020. Despite this growth, this figure was still much lower than the figures in 2015/2016 when there was nearly £60 billion subscribed to cash ISAs.
In 2020, over £24 billion was invested in stocks and shares ISAs – an increase of just under £1 million from 2019. This was also 14% higher than the amount invested in stocks and shares ISAs since 2015/2016. Check out the graph below to find out more.
Year | Cash ISAs | Stocks and shares ISAs | Total |
---|---|---|---|
2015/2016 | £58 billion | £21 billion | £80 billion |
2016/2017 | £39 billion | £22 billion | £62 billion |
2017/2018 | £40 billion | £28 billion | £65 billion |
2018/2019 | £44 billion | £23 billion | £68 billion |
2019/2020 | £49 billion | £24 billion | £73 billion |
The average amount subscribed into adult ISAs has remained fairly consistent since 2015/2016. The average amount in a cash ISA in 2019/2020 was £5,024, which is the lowest amount in a cash ISA since 2016/2017.
The average amount in a stocks and shares ISA in 2019/2020 was £8,875. This is also the lowest average amount since 2016/2017.
Year | Cash ISAs | Stocks and shares ISAs |
---|---|---|
2015/2016 | £5,801 | £8,322 |
2016/2017 | £4,622 | £8,623 |
2017/2018 | £5,228 | £9,685 |
2018/2019 | £5,187 | £9,331 |
2019/2020 | £5,024 | £8,875 |
A junior cash ISA is a tax-free long-term savings account for under-18s in the UK. The current savings limit for the 2021/2022 year is £9,000.
By 2020, the number of junior ISAs grew to over 706,000 cash ISAs and 317,00 stocks and shares ISAs. In total, this amounted to over 1 million junior ISAs, an increase of 38% since 2015/2016.
Year | Cash ISAs | Stocks and shares ISAs | Total |
---|---|---|---|
2015/2016 | 497,000 | 241,000 | 738,000 |
2016/2017 | 569,000 | 225,000 | 794,000 |
2017/2018 | 636,000 | 271,000 | 907,000 |
2018/2019 | 668,000 | 286,000 | 954,000 |
2019/2020 | 706,000 | 317,000 | 1,023,000 |
The total amount subscribed to junior ISAs was £971 million in 2019/2020 – £3 million less than in 2018/2019. While the total value of cash ISAs increased by £42 million in 2019, the total amount in stocks and shares ISAs dropped by £45 million in a single year. This means that cash ISAs hold 61% of this total, with stocks and shares making up the remaining 39%.
Year | Cash ISAs | Stocks and shares ISAs | Total |
---|---|---|---|
2015/2016 | £522 million | £399 million | £921 million |
2016/2017 | £525 million | £333 million | £858 million |
2017/2018 | £517 milllion | £385 million | £902 million |
2018/2019 | £555 million | £419 million | £974 million |
2019/20 | £597 million | £374 million | £971 million |
Interestingly, the average amount invested in junior stocks and shares ISAs is more than junior cash ISAs. The average amount invested into a stocks and shares ISA was £1,180 in 2020, this is 39% more than the average amount invested into a junior cash ISA (£846). Explore the graph below to find out more.
Year | Cash ISAs | Stocks and shares ISAs |
---|---|---|
2015/2016 | £1,050 | £1,656 |
2016/2017 | £923 | £1,480 |
2017/2018 | £812 | £1,421 |
2018/2019 | £830 | £1,465 |
2019/2020 | £846 | £1180 |
This type of savings account can save you from a lot of financial stress and anxiety.
Read more…Use our calculator to find out how long it would take you to save up a million pounds based on the interest on your savings account.
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Discover all you need to know about 5-year fixed-rate bonds, including how to find the best one for you.
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