Most Brits don't have enough in the bank

According to National Savings and Investments (NS&I) nearly two thirds (59 per cent) of people do not have adequate emergency savings.

09:43 10 May 2004

According to National Savings and Investments (NS&I) nearly two thirds (59 per cent) of people do not have adequate emergency savings.

It is generally agreed people should have around three months salary saved away in case of unexpected costs or difficulties.

New figures from NS&I have shown that men are more likely to have savings than women (42 compared with 34 per cent); and part-time workers (44 per cent) are better prepared for unexpected costs, compared with full-time workers (38 per cent).

Awareness of security also comes with age: 51 per cent of those over 65 have emergency savings, in comparison with only 21 per cent of people aged between 16 and 24, and 27 per cent of those aged 25-34.

The NS&I lists a number of reasons why people should consider tucking away some savings. Among them are, employment uncertainty or the need to change jobs; unforeseen circumstances and expenses such as a new car or emergency roof repairs, which are made all the more difficult by the higher costs of living - London has been shown to be the seventh most expensive worldwide.

The NS&I comments that: "Debt might seem a good option when interest rates are low, but it takes longer to pay off." Additionally, it points out that debt is more expensive than saving up, and many people are opting for the SKI-ing phenomenon (spending the kids' inheritance).

Gill Cattanach, marketing director at NS&I, concludes: "National Savings and Investments is committed to encouraging people to save, helping to close the savings gap."