UK residents believe they could only maintain their current lifestyle for four months if they suddenly lost their job, new research reveals.
A survey of 2,000 UK adults has found that the average length of time people think they could maintain their current lifestyle is 4.21 months – however, more than a fifth of UK adults (22 percent) think they could live off their emergency fund for over 6 months.
One worrying statistic that emerged from NerdWallet UK’s research was that 10 percent of 55-64-year-olds feel they could only maintain their current lifestyle for less than 3 months if they lost their job.
The research found that the most popular savings goal is retirement, with 51 percent of UK adults listing this as one of their top three savings goals.
The other two most popular savings goals included building up an emergency fund (41 percent) and Holidays and travel (40 percent).
NerdWallet found that 26 percent of those surveyed estimated they will achieve their personal savings goal in a year or less, and 12 percent think it will take 2 years.
24 to 35-year-olds are among those most confident that they will soon reach their savings goal, with 36 percent estimating they’ll achieve it in a year or less – a full 10% above the national average.
However, 28 percent of UK adults said they are not confident they would ever meet their goal. Those aged 65 years and over are the most likely age group to say this, at 38 percent.
On the other hand, 40 percent of this age group said they think they will achieve their savings goal in a year or less.
Amy Knight, personal finance writer and spokesperson at NerdWallet UK, said: “Many households’ budgets have taken some hard knocks lately, so it’s encouraging to see consumers fighting for their finances by actively saving.
“Some hopeful statistics have come out of the NerdWallet UK survey, including 89 percent of UK adults having a clear savings goal.
“Getting specific about what you’re aiming towards lets you work out how much you need to save each month to reach it. It’s much harder to stick to a budget day-to-day without a strong sense of where you’re heading.
“38 percent of respondents said they expected to meet their main savings goal in 2 years or less, suggesting determination among Brits despite the listless economy.
“Switching to a new savings account with a higher interest rate is one of the most popular ways to boost savings, and 36 percent of adults surveyed said they’d taken this step last year.
“When weighing up interest rates across different banks and savings accounts, be on your guard for fees as well, to avoid an unexpected blow when you make a transfer or withdrawal. You may need to leave your money in a savings account for a minimum period to benefit from favourable interest rates”
