SCOTS are among the worst savers in Britain with a buffer of just three weeks salary to draw on in times of crisis.
A new report has found Scotland ranks second last in a poll of the UK’s top savers, with the average female holding just a week’s salary in reserve.
Financial planners and experts recommend a minimum of three months savings to protect themselves in the event of a cash shock.
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The results found that just under half of surveyed Scots considerably over-estimated the extent to which savings grow, which the report cites as a factor for the lack of finances herd in reserve.
It also claims that just one per cent of Scots see themselves as having an affluent financial future, under a third say they are comfortable and aiming to support myself and any dependents, while just over half get by on a tight budget.
The East Midlands, London and Wales were named as the UK’s top savers in the UK by the Regional Savings Index (RSI), a new study which analyses the state of savings relative to wages across Britain.
The Index, launched today, compares average savings to average earnings and shows how many weeks’ buffer individuals in each region have saved in relation to their annual salary.
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The study, from online investment service Wealthify, was carried out last month by independent research agency Opinium with 1000 people aged 18 to 55 asked.
Those asked earn less than £50,000 a year.
The survey found that while residents in the East Midlands, who topped the index, had an average of eleven weeks’ salary in savings, Scots had three weeks, just above England’s North West and the West Midlands, which prop up the table with two.
When broken down by gender, the findings show that women are saving less than half that of men. In the case of Scotland, women have saved 10 times less than parts of England with just a week in reserve.
On top of the savings index, Wealthify asked Scots how much £10,000 would grow in the average cash ISA and how they saw their future financially.
The results 48 per cent of those surveyed north of the border thought that £12,000 would grow to £16,126 nearly £4000 more than the true value £12,931. Less than 40 per cent got the answer right.
Richard Theo, chief executive and co-founder of Wealthify, said: “”It’s alarming that Scottish savers have such small amounts saved. With just three weeks’ worth of salary held in savings on average, not only are Scots well below the three months’ recommended by financial experts, they also trail behind the UK average.
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“In addition, Scottish savers are among the least confident about their financial futures, with only 1% believing they will be affluent over the long term.
“Scottish savers need to do far more to build up a financial buffer that will help protect them against life’s little surprises. But with interest rates so low, it’s no wonder people are struggling to save adequately.”
Across Britain, nearly half of those surveyed saw themselves as getting by on a tight budget and one in 10 think said they struggled to afford the bare essentials
Londoners were the most ambitious when looking at their financial future, with 11% seeing themselves as affluent and being able fund a comfortable lifestyle, with men and women viewing their financial future in the same way.
Crucially it said around seven per cent overall and one in 10 in some regions “are burying their heads in the sand”.
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