Britons spend spare cash on debt

Britons tend to spend their spare cash on paying off debts rather than investing in pensions and savings for the future, a new survey has found.

10:34 25 November 2004

Britons tend to spend their spare cash on paying off debts rather than investing in pensions and savings for the future, a new survey has found.

The ACNielsen Global Consumer Confidence Survey found that the UK has the highest percentage of consumers in Europe who put spare cash into debt repayment.

But this does not look likely to lead to a lessening of the so-called debt crisis, as Britain also has the second fewest number of people with any spare cash left over at the end of the month.

The survey found that ten per cent more Britons (37 per cent) spend their cash on paying off debts than the global average, while only Portugal has more people left without spare cash once essential living expenses are deducted.

"In Europe, the UK has the highest percentage of consumers who say they spend their spare cash on paying off credit cards debts and loans - and at the same time are among those least likely to invest in savings/deposits," said Frank Martell, president, ACNielsen Europe.

"The UK also ranks among the lowest in Europe for investment in pensions and the stock market/mutual funds.

"Among British consumers who do have spare cash, their first priority is debt repayment. Overall, the UK ranked fifth for debt repayment among all 28 countries included in the survey."

Generally in Europe, while consumers were concerned about the state of the economy, the biggest expense was 'out-of-home entertainment' while putting money into savings/deposits was the second most popular use for spare cash in almost every other European nation.

Belgian consumers were among the highest in Europe for putting spare cash into saving/deposits accounts and into superannuation and pensions, while the Norwegians ranked the highest for saving the most in share and mutual funds.

The survey was carried out in October among 14,000 consumers in 28 markets across Europe, the US and Asia Pacific.