Debt advice news: Savings fall over Christmas

12/01/2010

People could be risking debt problems in 2010 by not saving over the Christmas period.

The Nationwide savings index was driven down by four points between November and December of last year (2009).

A quarter of people weren't saving any money at all and that people placed less importance on saving around Christmas, according to the report.

Andy Hutchinson, head of savings at the bank, commented: "Discouragingly, the number of those who are saving regularly is at its lowest point since the Index began in May 2008.

"On the other hand, this could be because of seasonal fluctuations … and we mustn't forget that the Base Rate is lower now than it was 12 months ago.

"Nevertheless, it's still worrying that a quarter of us are not saving any money at all."

Prioritising Christmas spending and the VAT increase from 15 to 17.5 per cent may be responsible for December's decline in spending, the bank suggested.

Director of EuroDebt Kevin Still, said: "In the current financial climate the low number of savers is to be expected, many households do not have surplus income to regularly save for anything other than annual expenditure items like your car service or repairs arising the MOT.

"It is also probable that many people have followed sound debt management advice in budgeting for Christmas, so there would be a natural outflow of savings in December.

"EuroDebt's concern is the people with no savings that are still paying for Christmas 2008 and in urgent need of debt advice."

Tags; Debt Management and Banking,

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