47% of Brits have been forced to dip into savings since the credit crunch

18 February 2009 / by Rebecca Sargent
Almost half of UK savers have been forced to dip into their investments since the onslaught of the credit crunch, while 14 per cent have either stopped saving or reduced the amount they save

Since the credit crunch hit the UK last year, household budgets have been feeling the pinch as bills have crept slowly up. This is demonstrated in the fact that 47 per cent of Brits with savings have had to use them to some extent.

The survey of 2,000 Brits conducted for Fairinvestment.co.uk* found that 18 per cent of people with savings have had to use up to 10 per cent of their savings since the credit crunch hit – this equates to £281, as the research also found that the average amount saved came to £2,813.

A further seven per cent said they had used between 11 and 20 per cent of their total savings, while five per cent have had to use between 21 and 30 per cent, and four per cent have used between 31 and 40 per cent.

Worryingly, five per cent of Brits with savings admitted that since the credit crunch they have used between 91 and 100 per cent of their savings, which equated to £2,560 when compared to the average amount saved.

In addition, eight per cent of Brits with savings accounts have had to reduce the amount they save, while six per cent have had to stop saving altogether.

Commenting, chartered financial planner at Fairinvestment.co.uk, Sharon Bratley said: "It is hardly surprising that so many Brits have had to dip into their savings. The cost of living is going up, and so is the number of job losses, leaving Brits vulnerable and dependent on back up like savings.

"However, when savings run out, there may not be anything to fall back on. So, it's important that if people do need to dip into their savings that they only do so for essentials, keeping their savings for as long as possible.

"Despite disappointing saving interest rates as the Bank of England cuts rates, some accounts do offer worthwhile returns, particularly fixed rate savings accounts and bonds which could also act as an incentive to keep savings locked up."

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*Survey conducted for Fairinvestment.co.uk by OnePoll with 2,000 respondents