Brits are frittering away more than £50billion in savings on holidays as they try to escape the British weather, despite the credit crunch and impending recession, new research from Abbey Savings has revealed.
According to the study, more than a quarter of those questioned believe that holidays are the best way to spend extra cash, rather than putting it into a savings account
The average Brit spends 10.1 per cent of their net income (around £1,650) on their holidays according to Abbey, which adds up to £81billion being spent on holidays each year.
And, more than half of Brits are using their savings to pay for their holidays, equating to £50.4billion, which, in the current economic climate means that Brits are throwing potential interest down the drain.
High interest rates for savings accounts
such as Abbey's eSaver Direct are common these days and have been since the credit crunch kicked in. A rate as high as 6.5 per cent could mean that savers are missing out on £3.2billion in interest on the cash they are spending on jetting off on holiday.
The study found that saving is not a priority for 46 per cent of Britons, whereas treating themselves to a luxury holiday was a top three priority for 33 per cent of Brits questioned.
Director of savings and investments at Abbey, Reza Attar-Zadeh, said: "If people cut back a small proportion of the amount they spent on holidays and kept their savings, this would make a real difference to their financial wellbeing. With savings rates at excellent levels, there has never been a better time to save for the future."
The news coincides with the latest results from holiday tour operator TUI AG that displayed a significant increase in turnover, despite the difficult economic conditions currently hitting the UK and the rest of Europe.
© Fair Investment