Jump to content
House Price Crash Forum
Sign in to follow this  
Converted Lurker

Brits Begin To Dip Into £6 Billion Worth Of Isa Savings

Recommended Posts

Britons are being forced to use hard earned savings to meet the rising cost of living, according to new research from Abbey Savings. The study found that on average ISA savers have withdrawn £579 each (£6 billion in total), which equates to 26 per cent of the average ISA subscription for 2007/2008...

Almost a third (31 per cent) of those questioned said that it was day-to-day costs which had forced them to make withdrawals while a further 15 per cent specifically cited bills such as mortgage repayments or utility bills as the reason for pulling out their cash.

http://firstrung.co.uk/articles.asp?pageid...&cat=44-0-0

Share this post


Link to post
Share on other sites

Thats nothing, I potentially have had the head gasket go on my car. So thats going to be more than £579. Plus I have to hire a van to move house next month.

Share this post


Link to post
Share on other sites

Savings are now negative , first sime since the 1958 or 50 years.

It's not taking money to invest, just covering living costs.

savings2006ja2.gif

Saving represents that part of disposable income (adjusted for the change in pension entitlements)

that is not spent on final consumption goods and services. It may be positive or negative depending

on whether disposable income exceeds final consumption expenditure, or vice versa. Assuming that

saving is positive, the unspent income must be used to acquire assets or reduce liabilities.

In so far as unspent income is not used deliberately to acquire various financial or non-financial assets,

or to reduce liabilities, it must materialize as an increase in cash, itself a financial asset. If saving is

negative, some financial or non-financial assets must have been liquidated, cash balances run down or

some liabilities increased

Currently at -4300 Million but that may be adjusted later on in the series. People are running on cash

and credit, not saving like the last crash. The low interest rates along with high inflation make saving

much less appealing than last time. It (NSSH) has never been negative since 1958, so either it will be adjusted

or there is something very wrong.

Share this post


Link to post
Share on other sites
And people are expected to save with living costs going up how exactly?

Perhaps if we put up interest rates that might make more people save?

They could try not living extravagently.

People mither on about gas bills going up a couple of hundred quid a year, but will think nothing about splashing out on a new plasma TV or multiple foreign holidays each year.

Share this post


Link to post
Share on other sites
Britons are being forced to use hard earned savings to meet the rising cost of living, according to new research from Abbey Savings. The study found that on average ISA savers have withdrawn £579 each (£6 billion in total), which equates to 26 per cent of the average ISA subscription for 2007/2008...

Almost a third (31 per cent) of those questioned said that it was day-to-day costs which had forced them to make withdrawals while a further 15 per cent specifically cited bills such as mortgage repayments or utility bills as the reason for pulling out their cash.

http://firstrung.co.uk/articles.asp?pageid...&cat=44-0-0

Depressing, indeed. But would have been even more revealing if Abbey had said how this differs from last years, or 'normal' ISA withdrawl patterns. Was there a marked increase?

Incredible that almost a quarter of the withdrawn savings went on 'luxury' items...

I give up.

Share this post


Link to post
Share on other sites
They could try not living extravagently.

People mither on about gas bills going up a couple of hundred quid a year, but will think nothing about splashing out on a new plasma TV or multiple foreign holidays each year.

Agreed but too many people have already done that with debt, which then gives you a catch 22.

Currently we need people to save, pay back what they owe and pay higher borrowing costs all at the same time.

It's impossible to do.

Share this post


Link to post
Share on other sites
Depressing, indeed. But would have been even more revealing if Abbey had said how this differs from last years, or 'normal' ISA withdrawl patterns. Was there a marked increase?

Incredible that almost a quarter of the withdrawn savings went on 'luxury' items...

I give up.

Isn't that what savings are for? Keep 6 months aside for unexpected expenses and/or employment gaps, but anything above that I set aside for 'luxury' items like holidays, cars, TV etc.. the 'essentials' come out of pre-savings pay. If savings are not for luxuries, then what exactly is the point of saving beyond a 6-12 month emergency fund?

Share this post


Link to post
Share on other sites
If savings are not for luxuries, then what exactly is the point of saving beyond a 6-12 month emergency fund?

When you are spending more than your outgoings luxuries can't be good, if everything is fine then saving up for a holiday or plasms seems fine to me.

At the start of a recession not so good.

Share this post


Link to post
Share on other sites
Isn't that what savings are for? Keep 6 months aside for unexpected expenses and/or employment gaps, but anything above that I set aside for 'luxury' items like holidays, cars, TV etc.. the 'essentials' come out of pre-savings pay. If savings are not for luxuries, then what exactly is the point of saving beyond a 6-12 month emergency fund?

Provided you have your six months emergency fund intact, then fine.

But for a lot of people ISA's are part of a long term pensions strategy (given the virtual collapse of the mainstream pensions industry), and dipping into that fund has long term consequences.

Those consequences will make themselves felt long after the coveted plasma has gone to landfill, and that foreign holiday is history.

Share this post


Link to post
Share on other sites
Savings are now negative , first sime since the 1958 or 50 years.

I've always maintained that borrowing, particularly mewing actually distorts the savings figures massively, bear with me on this;

but as folk MEW, (perhaps they get a chq for 50K), that takes time to go through, let's say a couple of years. Now during that time (as it's spent) you'll have the BSA claiming "record savings for Brits" etc when in reality it's just cash that has been withdrawn from the atm/house and put somewhere safe until it's gone/spent. Now given that the new national sport of mewing/remortgaging has been a trillion pound turnover business over the past 6 years, it's not hard to imagine why savings apparently boomed over the past few years. It wasn't savings, it was actually borrowings put into savings accounts. :blink:

Edited by Converted Lurker

Share this post


Link to post
Share on other sites

Let's just be honest here and admit that the Government has mismanaged the country. Whatever have they been doing with all the money they had at their disposal? After reading about all the fines imposed on people as well (a rake in of £200 a minute in speeding fines, £100 plus for over filling a dustbin) they should really be in clover. The whole bunch of these 'ruling classes' need removing from your petty County Council to the EU.

Share this post


Link to post
Share on other sites
I've always maintained that borrowing, particularly mewing actually distorts the savings figures massively, bear with me on this;

but as folk MEW, (perhaps they get a chq for 50K), that takes time to go through, let's say a couple of years. Now during that time (as it's spent) you'll have the BSA claiming "record savings for Brits" etc when in reality it's just cash that has been withdrawn from the atm/house and put somewhere safe until it's gone/spent. Now given that the new national sport of mewing/remortgaging has been a trillion pound turnover business over the past 6 years, it's not hard to imagine why savings apparently boomed over the past few years. It wasn't savings, it was actually borrowings put into savings accounts. :blink:

Your just being deliberately misleading with this, saying borrowings in savings accounts are in fact not real savings.

What's next MEWing has been distorting the UK's GDP for the last decade.....

Edited by interestrateripoff

Share this post


Link to post
Share on other sites
Isn't that what savings are for? Keep 6 months aside for unexpected expenses and/or employment gaps, but anything above that I set aside for 'luxury' items like holidays, cars, TV etc.. the 'essentials' come out of pre-savings pay. If savings are not for luxuries, then what exactly is the point of saving beyond a 6-12 month emergency fund?

You must be one of the lucky few who have a sufficient pension saved up already. Speaking of which, this is my favourite part of the stats:

Voluntary pension contributions made by UK adults have almost halved in the past 12 months, according to Prudential research, which reveals that those who pay into company and private pension schemes say they have cut contributions by a staggering £134 a month compared with last year.

Dooomed, doomed, dooomed!

Share this post


Link to post
Share on other sites
Britons are being forced to use hard earned savings to meet the rising cost of living, according to new research from Abbey Savings. The study found that on average ISA savers have withdrawn £579 each (£6 billion in total), which equates to 26 per cent of the average ISA subscription for 2007/2008...

Well, it might have been me. If I needed to raid savings. And ony had an ISA as savings, otherwise would raid taxable savings first.

Oh, and if NW had sorted out my xferrd ISA from B&B. :) Got letter explaining delay, still no actual savings book!

Share this post


Link to post
Share on other sites
Depressing, indeed. But would have been even more revealing if Abbey had said how this differs from last years, or 'normal' ISA withdrawl patterns. Was there a marked increase?

Incredible that almost a quarter of the withdrawn savings went on 'luxury' items...

I give up.

Agreed. I know someone who works in personal banking at a big bank and meets customers in debt every day. The average Joe/Joan.

To help them pay off their debts, the first thing she does is look at their monthly statement and suggests that they cancel their 2 or 3 mobile phone subs plus the SKY tv sub. Alone, this usually takes £100 a month or more off their debt. She points out that this is > £1200 a year.

The look of horror on their faces is a picture she says. More often than not, they refuse. At this point, my friend shows them the door and tells them to go to the Citizens Advice Bureau or similar............

Until phone and SKY subs start to be cancelled in great numbers, we won't really be in a recession, IMO. ;)

Share this post


Link to post
Share on other sites
Alone, this usually takes £100 a month or more off their debt. She points out that this is > £1200 a year.

I would love to see their face when told: "Your debt of £24000 is almost exactly average, but you can easily repay it just by cancelling SKY and your phone contracts for the next 20 years, although now that I think about it, it won't actually cover even the interest, but luckily it seems you could do with about 20 years on a diet so you can also repay the capital. I am really surprised you don't like that, I am only trying to help ...." :lol::lol::o:lol:;):lol::P:lol:

Share this post


Link to post
Share on other sites
Thats nothing, I potentially have had the head gasket go on my car. So thats going to be more than £579. Plus I have to hire a van to move house next month.

You can buy a whole fully functioning car at the auction for £579 if you know what your doing. Head gaskets should not 'go' on a well maintained modern car.

Share this post


Link to post
Share on other sites
Isn't that what savings are for? Keep 6 months aside for unexpected expenses and/or employment gaps, but anything above that I set aside for 'luxury' items like holidays, cars, TV etc.. the 'essentials' come out of pre-savings pay. If savings are not for luxuries, then what exactly is the point of saving beyond a 6-12 month emergency fund?

I'm saving to buy a house with little borrowed money. Makes sense if you don't already own. One pound saved now is two pounds less to pay off the mortgage (plus waiting is a good idea now!).

Share this post


Link to post
Share on other sites
Savings are now negative , first sime since the 1958 or 50 years.

It's not taking money to invest, just covering living costs.

savings2006ja2.gif

Saving represents that part of disposable income (adjusted for the change in pension entitlements)

that is not spent on final consumption goods and services. It may be positive or negative depending

on whether disposable income exceeds final consumption expenditure, or vice versa. Assuming that

saving is positive, the unspent income must be used to acquire assets or reduce liabilities.

In so far as unspent income is not used deliberately to acquire various financial or non-financial assets,

or to reduce liabilities, it must materialize as an increase in cash, itself a financial asset. If saving is

negative, some financial or non-financial assets must have been liquidated, cash balances run down or

some liabilities increased

Currently at -4300 Million but that may be adjusted later on in the series. People are running on cash

and credit, not saving like the last crash. The low interest rates along with high inflation make saving

much less appealing than last time. It (NSSH) has never been negative since 1958, so either it will be adjusted

or there is something very wrong.

I suspect that people might have been both saving, and also increasing total debt levels, but with a net increase in debt. So perhaps increasing the amount on car loans, but also putting away £25 a month. I suspect that what is happening is the saving is stopping so we're seeing a reduction in saving rates, but perhaps also a reduction of debt...

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 400 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.