to think most people don't have savings?

[horseyhorsey17]

I realise this is going to get a whole range of different views and experiences and I am interested to hear them all, but I recently read some research saying that most families in the UK have less than £600 in savings. This got me wondering - I am a single mum with two teens and a mortgage, and I don't have savings as such but I do have a private pension (had it for nearly 20 years now) that I pay roughly 5% of my salary into (as well as a work pension) and I overpay on my mortgage. I consider this a more effective use of my money than saving, which I can't afford to do as well. Do most people have pensions AND savings? Or neither?

Just really curious as I spend my salary every single month and all my friends do the same. That might be just my peer group! I suppose I could save if we never went on holiday - but I'd rather have the holidays tbh. You only live once and you can't take it with you, etc etc.

People overpaying on their mortgages - may I ask how you do it (if you do it regularly)? I did it last month and spent about an hour on the phone explaining what I intended to do and how much. When I said I wanted to pay an extra £5k the lady on the phone snorted and said "Oh! Oh well that's no problem then, you're nowhere near your limit for the year!" I felt really embarrassed...is that super low?!

Can't imagine putting myself through that every few weeks (not that I have 5k lying around every few weeks but you know what I mean).

If my fridge freezer, my Tv and my cooker stopped working in the same week I could replace them and give my teen a grand for something important. Then I’m done. That’s the level I’m working on.

I do get an extra element of Universal Credit which bumps it up a little, I think its the limited capability for work but don't get PIP or anything like that. I'm fortunate in that I don't need a car where I live and I think that's where a huge amount of people spent a lot of money. If I drove not only would I never be able to save a penny but I'd likely get into debt just to be able to keep the car running so I really feel for people who don't have the option to not have a car.

My mortgage provider has an online portal for managing it, it’s very easy to make overpayments on there. We set up a regular payment for it every month then any extra I just do on the portal.

Some people are natural savers, some are natural spenders I think. I am the first - I earn minimum wage but have a direct debit into a savings account of around 1/4 of my salary. I occasionally have to borrow some of it back but it's mainly there so I can feel comfortable about unexpected repairs and emergencies. If I want something specific, I save for it - never use credit. And pay the max contribution into my pension too. Live within your means and expect the unexpected is my motto!

Same for me. From day 1 of working I saved 5 pounds a week. That was 10% of my take home pay. I was from poor background and was very well aware that I could not depend on the non existent bank of mom and dad.

Thank you!! Definitely doing this next time!

I was with my friends last week, all of them have very good jobs and all of them said they are unable to save anything at the moment.

They probably have some ‘saved’ alright but are definitely not adding to that amount at the moment if they do.

They would all be around age 50, all have children in school and are finding this stage very very expensive.

I just sent the money by internet banking. Find out the sort code, account number and reference number and just set up a payment in your current account. Once it's done, you can just send what money whenever you like.

As for the amount, any amount is worthwhile, if your interest rate is higher than you can get on savings, and £5000 of anyone's money is never going to be 'super low'.

If you're on a fixed rate it's usually 10% or sometimes 20% of your mortgage balance, each year, but all banks have different rules and definitions of when they count a year from, so make sure you know this.

I'm 60 now. Since I was 27 I've saved £200 per month into a SIPPS (never had a workplace pension, have been self-employed for 25 years), £2000 per month into my house (that's what I regard a capital repayment mortgage as), and god knows how much into my children (they are my treasure). I now also have accumulated £10000 as rainy day money. I'll soon have fully paid off the mortgage and will have £100000 from my darling dad's estate as my 'war chest' for illness in old age, plus house equity of £800000 and a pension pot of £300000. So I feel pretty positive on the whole, but for many years it was pretty hairy - and holidays were camping trips to the west country. The best things I did were (a) never stopped work and paying full NI, (b) paying that pension contribution every single month for 33 years and (c) divorcing my financial wastrel of a husband. I've always taken the view that a new boiler would go on the credit card mind!

Multiple types of savings:
1 - workplace pension
2 - overpay mortgage
3 - instant access savings
4 - ISA S&S
5 - Premium Bonds
6 - Fixed locked savings

I work in finance though so I am quite aware of different investment vehicles etc and earn high which allows this. I would always have a small rainy day fund no matter what.

From my very first very poorly paid job I was determined to save something every time I was paid. Sometimes it was just a couple of pounds but I felt it was important.

We have a small amount earmarked for a house deposit when the rates get better but other than that definitely under 2k between us

DH job is as secure as they get. Mine is secure as far as I know. We have had an expensive year tbh as getting married and although parents have helped towards lots of the cost it’s still expensive

We hope to have kids soon and I hope we can still save once they’re here, anyhow this thread has made me feel better

Most people either just have enough to fund their lifestyle (be it basic or more extravagant) or they invest.

“Savings” isn’t really a very practical or aspirational idea. Children should be taught how to invest.

Mine (Santander) you can just do on the app!

I overpay on my banking app, my mortage is with santander so I manage it there.

I'm sure plenty of people would be over the moon to pay £5k off their mortgage. I think she meant the paperwork side is much easier if in your allowance.

My husband and I are also both Generation X, like yourself, however, we've got different mindsets to yourself. We have made provisions for retirement. We would seriously lose sleep if our savings dropped below £10k, but they are significantly higher. We've both been avid savers since childhood.

We do not go on a foreign holiday every year, usually would do one on average every 4 years. Do an inexpensive UK holiday every 3 years or so. We do not eat out or get takeaways regularly. We are pretty frugal.

It is much more savvy to put what you'd like to overpay on your mortgage into a savings account (provided your current mortgage interest rate is lower than savings rates are at the moment), then when your fixed deal is up, or if the savings rates fall below your mortgage rate, then use the chunk of savings to overpay instead. This is what we do when we make overpayments and this is the most financially savvy way to overpay.

I'd personally urge you to save for an emergency fund of at least £5k, but preferably closer to £10k. You cannot put all emergency repairs on credit cards, I don't know any tradesmen that we use who even take credit cards. You may get an unlucky year and need a new boiler, repair a gutter leak, repair a garden fence etc., and with being unable to pay for these things on a credit card, you'd be screwed.

Personally, if I were you, I would:

1. Open up a good interest rate savings account, such as a regular saver or an easy access ISA.
2. Pop your current mortgage overpayment into this account instead to use on a larger overpayment when your fixed deal ends (providing the interest rate is higher than your mortgage interest rate).
3. Open a second good rate savings account (you can only pay into one ISA per year, so probably better to use the mortgage overpayment savings for your ISA to take advantage of it being tax-free). This second account will be for your emergency fund savings.
4. Consider forgoing your annual foreign holiday and just going every other year instead.
5. Consider cutting takeaways down to once per month instead of twice.
6. You say you are a humble writer, I'm not sure what type of writing you do, but is this something you could scale up? You could use David Gaughran and Matthew J Homes for self-publishing advice and scaling up advice. This could potentially increase your earnings.

I think where your mindset is slightly flawed (in my opinion), in terms of "I consider this a more effective use of my money than saving, which I can't afford to do as well." and "You only live once and you can't take it with you, etc etc." is that, yes although bringing down your mortgage capital is good, it's not the same as having an emergency savings funds for necessary repairs to your property etc. And yes, you do only live once, but you need to be able to afford to fund your life while you are alive and if you splash out on a holiday then your boiler packs up the following week, you're screwed without your emergency savings fund. If you're dependent on using a CC for an unexpected necessary expense you may struggle to pay it back should something awful happen such as you lose your job etc.

I wish you well and hopefully happy saving!!

32, very working class background, parents have never earned close to 20k.
Went to uni on the lowest band of household income, started working on a 17k salary now around 40. DH similar age, always earned less than me until may leave when he took over but nothing astronomical.
Saved about 30k by 28 to purchase a property, 20k on a wedding about 15 months later, another 15k to put towards renovation a year or so later.
Personal pension is about 25k, DD’s savings 3k, 2k emergency pot, 2k in a pot for some work on the house next year but might leave this as extra emergency fund while on 2nd mat leave, about 3k in the mat leave pot with £600 a month diverted to this for the next 4 months.
Once I return to work the spare ~£1k or so a month will go into a savings pot for a house move.

We do not go on a foreign holiday every year, usually would do one on average every 4 years. Do an inexpensive UK holiday every 3 years or so. We do not eat out or get takeaways regularly. We are pretty frugal

Each to their own but I'd rather have the holidays and takeaways, and no savings.

If the house falls down that's what home insurance is for.

DH and I both have good Civil Service pensions and a lot of savings (six figures) - the vast majority of that is tied up in a long term saver at 5.96%

We have a mortgage on a 5 bed detached, and I'm 33 - should have it paid off by the time I'm 40

My tumble dryer broke down today. Luckily I have a floating account of £2k of easy access so that was easily sorted

Appreciate we are very fortunate but it takes a lot of work to be streamlined. We consult the spreadsheet daily, shop in Lidl and our only big annual extravagance is a £5k all inclusive family holiday

We drive boring cars. Volvos

It doesn't cost two grand to buy a new tumble dryer let alone repair one.

Thanks - I already work full time (magazine editor), edit another magazine in my spare time and am writing a book so I don't really have the capacity for more work right now!

Holidaying every other year is too bleak for me - sorry. I have kids and going away with them is the thing I look forward to the most, as do they. I'd forgo savings for that tbh.

Already had the disastrous year where everything went wrong - boiler broke, front of house fell off (!), dog needed hideously expensive life-saving operation that wasn't covered by insurance, fence needed repairing (so other dog couldn't escape and get run over) plus I moved house post-separation and had to rewire it, replace carpets, paint everything etc so this has been the most expensive year of my life, I think. I did have some savings before that but now I do not! Hopefully there's not much left to go wrong again before I build up a bit of a rainy day fund - but having said that, 2024 is probably reading this and saying 'hold my beer!'

I have a pension which I pay 9.8%, I save in a few other places, one main savings for basically whatever I can, two small savings both £50 per month for planned bigger holidays and £120 per month saved for my son. I also overpay £500 per month on the mortgage however we have two incomes couldn't save if I was alone I could maybe manage £100 or so a month, I always need a bit of money saved of it stresses me out maybe a minimum of £2000 (ideally more).

You cannot put all emergency repairs on credit cards, I don't know any tradesmen that we use who even take credit cards. You may get an unlucky year and need a new boiler, repair a gutter leak, repair a garden fence etc., and with being unable to pay for these things on a credit card, you'd be screwed.

I have an MBNA credit card with constant offers of 0% money transfer into your bank account. We have the money to pay for this stuff but it makes far more sense to use MBNA’s and leave ours in a high interest account.

@floribunda18 · Today 15:46

We do not go on a foreign holiday every year, usually would do one on average every 4 years. Do an inexpensive UK holiday every 3 years or so. We do not eat out or get takeaways regularly. We are pretty frugal

Each to their own but I'd rather have the holidays and takeaways, and no savings.

If the house falls down that's what home insurance is for.

Yes, but I do believe it is a fine balance.
If you're fortunate enough to save some money for emergencies, great, that's what dh and I do. However if you're saving thousands upon thousands, that can't go beyond some ridiculously high level, without hardly any hols, enjoyments etc, than what is the point? Yes you can't act entirely on the "could be dead tomorrow' mindset but Jesus live alittle if you're financially 'able' to do so.