Nationwide's Savings Index has increased for the second successive month, rising to its highest level since November last year.
Following last month's 10 point increase, the building society's main Savings Index – which analyses consumer opinions towards savings – increased by three points in October to 90 points.
Meanwhile, its Savings Environment Index saw the biggest change, increasing by 8 points since last month, now standing on 85 points, as more people believe now is a good time to save.
Encouraged by these results, Andy Hutchinson, head of savings at Nationwide, believes that the "sharp rise" in the Savings Environment Index could be attributed to the recent ISA allowance increases for over 50s.
Although pleased that the Government has increased the ISA allowance, Mr Hutchinson claims more could be done. For instance, increasing the cash ISA limit to match the stocks and shares ISA limit, while ensuring the annual limit is linked to inflation, he says would encourage more people to save.
Despite increases in two of its indexes, Nationwide's two other indexes fell slightly as it appears savers are remaining cautious about current market conditions.
Its Importance of Saving Index fell by three points to 88 points as it appears more people believe it is not vital that they save now, while the building society's Future Savings Index – which determines whether people will be able to save more in six months time – now stands at 119 points, representing a two point decrease.
Commenting, Mr Hutchinson said that while there is evidence to suggest confidence in the economy is returning, "caution should remain".
"Over the first eight months of 2009, growth in household savings is down by 65 per cent compared to the same period in 2008," he said.
Before adding that while many people are choosing to pay off debts, "households are still finding it difficult to save in these challenging market conditions".
© Fair Investment Company Ltd