Latest news with #AlexandraLoydon
Gulf Today
3 days ago
- Business
- Gulf Today
Over 13m people in UK face ‘tough' financial problems
The concerning lack of ability for some people to cope with unexpected costs has been revealed as new data showed one in ten (10 per cent) of UK adults have no cash savings whatsoever, leaving them vulnerable when faced with increased bills. More than 13m people across the nation are thought to be facing tough conditions financially, including amassing debt, have little savings or have missed paying bills. While the headline figure of ten per cent having no savings at all is a worry, findings from the Financial Conduct Authority (FCA) actually show a far greater scale of people who have minimal ability to manage any sort of shock to their income, with a further 21 per cent having less than £1,000 saved. Most financial experts agree that individuals or families should aim to build an emergency savings buffer of three to six months' worth of essential expenses, depending on circumstances, according to the Independent. This can aid to continue paying bills and essential costs like groceries, rent or mortgage repayments in the event of sudden pressures, like health emergencies, loss of work or even surging inflation. In addition to not having enough savings, the FCA data underlined two further issues: 2.8m people who have persistent debt through credit cards, which can be one of the most expensive ways to hold debt, along with a continuing rise in people using buy now, pay later (BNPL) services. More than a third of women (35 per cent) aged 25-34 use these services and a full 40 per cent of single parents do so. While some of these services do not necessarily always charge interest initially – some do of course – missing payments can be extremely costly and building up bigger repayment costs can potentially push greater debt on peoples' future. StepChange, a charity which helps with free advice to people struggling with debt, said in a statement they 'want to see the Government invest in safe options for those who can't afford to save to cope with unexpected costs, including a permanent national crisis support scheme, building on the Household Support Fund and a national no-interest loan scheme, and by working with the financial services industry to expand affordable, low-cost credit.' The FCA also shared encouraging data from those who do seek help. From 1.7m people using debt advice or services in the past year, 61 per cent 'said their debts were more manageable' in the aftermath. Compare the Market data shows more than half (52 per cent) of Gen Z – aged 16 to 28 – do not have a 'rainy day fund' for emergency expenses, while more than a quarter (27 per cent) of all people who do have one have needed to use it recently to cover increased household bills and other essential expenses. Research by wealth managers St. James's Place shows more than a quarter of the nation feeling anxious about the year ahead in monetary terms. Alexandra Loydon, director of advice, said: 'Economic challenges remain, so it's more important than ever to take steps to make your money work harder. While building a financial plan may seem daunting, especially if you've never done one before, this really shouldn't put you off., the Independent report adds. 'Identifying your key financial goals and assessing your current financial situation are the simple places to start. From there you should focus on building your emergency fund by putting aside a small amount of money each month and ensuring you're getting the best rates of return. 'While these may seem like small steps, they all help you grasp your financial situation and take action to improve it, making a real difference to your financial resilience both now and in future.'
Yahoo
16-05-2025
- Business
- Yahoo
One in ten UK adults have zero savings - while millions suffer under credit card debt
The concerning lack of ability for some people to cope with unexpected costs has been revealed as new data showed one in ten (10 per cent) of UK adults have no cash savings whatsoever, leaving them vulnerable when faced with increased bills. More than 13m people across the nation are thought to be facing tough conditions financially, including amassing debt, have little savings or have missed paying bills. While the headline figure of ten per cent having no savings at all is a worry, findings from the Financial Conduct Authority (FCA) actually show a far greater scale of people who have minimal ability to manage any sort of shock to their income, with a further 21 per cent having less than £1,000 saved. Most financial experts agree that individuals or families should aim to build an emergency savings buffer of three to six months' worth of essential expenses, depending on circumstances. This can aid to continue paying bills and essential costs like groceries, rent or mortgage repayments in the event of sudden pressures, like health emergencies, loss of work or even surging inflation. In addition to not having enough savings, the FCA data underlined two further issues: 2.8m people who have persistent debt through credit cards, which can be one of the most expensive ways to hold debt, along with a continuing rise in people using buy now, pay later (BNPL) services. More than a third of women (35 per cent) aged 25-34 use these services and a full 40 per cent of single parents do so. While some of these services do not necessarily always charge interest initially - some do of course - missing payments can be extremely costly and building up bigger repayment costs can potentially push greater debt on peoples' future. StepChange, a charity which helps with free advice to people struggling with debt, said in a statement they 'want to see the Government invest in safe options for those who can't afford to save to cope with unexpected costs, including a permanent national crisis support scheme, building on the Household Support Fund and a national no-interest loan scheme, and by working with the financial services industry to expand affordable, low-cost credit.' The FCA also shared encouraging data from those who do seek help. From 1.7m people using debt advice or services in the past year, 61 per cent 'said their debts were more manageable' in the aftermath. Compare the Market data shows more than half (52 per cent) of Gen Z - aged 16 to 28 - do not have a 'rainy day fund' for emergency expenses, while more than a quarter (27 per cent) of all people who do have one have needed to use it recently to cover increased household bills and other essential expenses. Research by wealth managers St. James's Place shows more than a quarter of the nation feeling anxious about the year ahead in monetary terms. Alexandra Loydon, director of advice, said: 'Economic challenges remain, so it's more important than ever to take steps to make your money work harder. While building a financial plan may seem daunting, especially if you've never done one before, this really shouldn't put you off. 'Identifying your key financial goals and assessing your current financial situation are the simple places to start. From there you should focus on building your emergency fund by putting aside a small amount of money each month and ensuring you're getting the best rates of return. 'While these may seem like small steps, they all help you grasp your financial situation and take action to improve it, making a real difference to your financial resilience both now and in future.' Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
02-04-2025
- Business
- Yahoo
Majority of UK adults underestimate retirement savings needs
A sizable minority of UK adults underestimate how much they need to save for retirement, with many questioning their capacity to accumulate the necessary pension pool for financial security in later life. According to new data from St. James's Place (SJP), three out of five respondents (60%) are unsure whether they will have saved enough to meet a moderate level of living in retirement. The findings, published in SJP's Financial Health Report, revealed a concerning lack of understanding and engagement in retirement planning. The average total pension worth of UK people is £50,923 ($65,828), which is significantly lower than the £500,000 recommended by the Pensions and Lifetime Savings Association (PLSA) for a modest retirement living. Surprisingly, nearly a quarter (23%) believe they will only need £50,000 or less to retire comfortably, while nearly one-fifth (17%) say they will rely completely on state pension. Lack of Pension Awareness and Engagement A sizable proportion of Americans are still disengaged from pension planning. One-third (32%) say they have no idea how much they have saved, and one-fifth (19%) have never evaluated their pension at all. More over a third (36%) of individuals approaching retirement, aged 55 and up, believe they need less than £50,000 to maintain a decent quality of living, despite projections that this would barely cover a basic lifestyle. The data also revealed that financial planning plays a crucial role in building retirement confidence. Over half (56%) of those with a financial plan feel secure about their future, compared to just 33% without one. However, nearly a quarter (23%) of UK adults say that saving for their pension is not a priority. A Growing Gap Between Savings and Reality In addition to this, the report also highlighted that those approaching retirement are the least confident about achieving financial security. Just 15% of people aged 45-64 believe they will save enough for a moderate standard of living, compared to 32% of 35-44-year-olds and 40% of younger adults aged 16-34. For those already in retirement, the average pension savings across workplace and individual plans sit at £76,151 for 65-74-year-olds and £89,349 for those aged 55-64. These figures fall far short of the £500,000 recommended for a moderate standard of living, let alone the £790,000 required for a comfortable retirement. Alexandra Loydon, Director of Advice Policy & Operations at St. James's Place stated: 'As a society, we face significant gaps in awareness and preparedness for retirement. The shift from defined benefit to defined contribution pension schemes has transferred the burden of saving for retirement onto individuals and, while the introduction of automatic enrolment into workplace pension schemes marked a significant milestone in promoting retirement savings, the harsh reality is that many individuals are facing significant shortfalls. 'It is concerning that many people lack an understanding of how much they need to put aside to fund a moderate or comfortable standard of living in retirement and are not confident they'll reach these standards by retirement. Even among those approaching retirement, confidence is worryingly low.' Call for Action on Retirement Planning The research underscores the urgent need for improved financial education and engagement with pension planning. Loydon emphasises the importance of proactive steps, calling for financial education to be integrated into school curriculums and for reforms to auto-enrolment contributions to help address shortfalls. She added: 'Our research shows that having a financial plan in place builds confidence and engagement with retirement finances. As we move forward, decisive action at a policy, industry and individual level is required, such as integrating financial education into the school curriculum, addressing the current shortfalls in auto-enrolment contributions, and enhancing access to financial advice and guidance to help overcome barriers to retirement planning.' With a substantial portion of UK adults at risk of falling short in retirement, increasing awareness and encouraging long-term financial planning will be critical in closing the gap. "Majority of UK adults underestimate retirement savings needs" was originally created and published by Private Banker International, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
