What are the Average Savings in the UK: How Much Are Brits Really Saving?

The concept of saving money is a cornerstone of financial stability and planning in the United Kingdom. With the ever-changing economic landscape, understanding the trends and habits related to saving is crucial for individuals and families alike.  In the UK, the approach to setting aside funds varies significantly.

Factors such as age, income, and lifestyle play a pivotal role in shaping these habits. While some individuals prioritize building a financial cushion early on, others may find it challenging due to various constraints or lack of awareness.

This disparity is not just a matter of personal choice but is often influenced by broader economic conditions and societal norms. By understanding these patterns, we can gain a clearer picture of the financial preparedness of UK citizens and the factors that influence their behavior.

Average Savings per UK Household

What is the Average Saving in UK

In 2024, the landscape of savings in the UK presents a diverse picture. The average person in the UK has £17,773 in savings, a figure that underscores the importance of savings in financial planning and security.

However, this average masks significant disparities: half of the British population has £1,000 or less in savings. This statistic is particularly concerning given the rising cost of living and the importance of savings in cushioning financial shocks.

The gender gap in savings is also notable, with women having an average of £11,698 in savings compared to £23,951 for men, highlighting a significant disparity in financial security between genders.

Regional Variations in Savings

Savings in the UK also vary by region, with the East of England boasting the highest average savings at £27,561. In contrast, those in the West Midlands have the lowest average savings, traditionally. This regional disparity points to the uneven economic development and income distribution across the UK.

London, often perceived as affluent, has an average savings amount of only £8,901, suggesting that high living costs in the capital may be offsetting higher incomes.

Average Savings by Age Group

The pattern of savings in the UK significantly varies across different age groups, reflecting the changing priorities and financial capabilities at various life stages. The average amount saved increases predictably as individuals age.

This trend is indicative of the growing financial stability and accumulation of wealth over time.

Age Group/Generation Average Savings
18-24 (Young Adults) £2,533
55+ £35,607
Silent Generation £58,606
Millennials £5,943
Generation Z £2,463

The saving habits also differ markedly across generations. Baby Boomers and the Silent Generation, having had more time to accumulate wealth, show higher average savings.

In contrast, younger generations like Millennials and Gen Z face unique challenges such as student loans, lower starting salaries, and higher living expenses, which impact their ability to save.

This age-based analysis of savings in the UK highlights not only the differences in the amounts saved but also the evolving nature of financial goals and strategies across generations. It underscores the need for tailored financial planning and education that addresses the unique challenges and opportunities at each stage of life.

Savings and Income Correlation

Can You Save Money in UK

The relationship between income and the ability to save is a critical aspect of financial planning in the UK. There is a direct correlation between these two factors, with higher-income families typically able to set aside more funds. This correlation, however, is nuanced and influenced by various other elements.

The actual amount saved by individuals depends on several factors, including their attitude towards saving and their overall expenses. High-income individuals often face higher living costs, necessitating a larger financial cushion for retirement and emergencies.

Consequently, even with substantial earnings, the proportion of income saved may not be as high as expected. The ongoing coronavirus pandemic and the current cost-of-living crisis have further widened the gap between low and high-income households.

The economic strain has made it increasingly challenging for lower-income groups to save, while those with higher incomes continue to build their financial reserves.

Factors Affecting Savings

Influence of Interest Rate on Savings in UK

Now, we want to address some factors that affect the savings.

Interest Rates

Interest rates significantly influence saving behaviors. Higher interest rates typically make saving more attractive due to better returns on deposited funds. For instance, a bank account with £1,000 would earn £10 a year at a 1% interest rate, but £60 at a 6% rate. However, this relationship isn’t always straightforward.

During economic downturns, like the 2009 recession, lower interest rates didn’t necessarily reduce savings ratios. Instead, savings increased due to consumer pessimism about the future.

The effectiveness of interest rates in encouraging savings is also influenced by inflation rates. For example, a 15% interest rate with 16% inflation results in a negative real interest rate, reducing the incentive to save.

Income Levels and Economic Growth

Rising income levels generally lead to higher total savings as households have more disposable income. However, economic growth can also foster consumer optimism, leading to increased spending and a lower savings ratio.

The UK’s household saving ratio appears to be cyclical, rising during recessions and falling during periods of economic expansion. This suggests that economic cycles significantly impact savings ratios.

Income Distribution

Impact of Higher Income Distribution

The distribution of income across households also affects saving levels. Households with lower incomes typically have very low savings levels, as their financial focus is on necessities. As incomes rise, the propensity to save increases due to the diminishing marginal utility of consumption.

Therefore, a rise in the incomes of lower-paid individuals can have a more significant impact on increasing savings compared to a rise in the incomes of the wealthy.

Wealth and Asset Prices

Rising asset prices, such as house prices, can decrease the necessity to save. For example, homeowners may feel more financially secure and reduce their levels when their home values increase.

This was evident in the UK during the 1980s and early 2000s when significant rises in house prices led to increased homeowner wealth and reduced savings.

Consumer Confidence

Consumer confidence plays a large role in making the right decision. Optimistic households are more likely to borrow and spend, while low confidence can lead to increased savings for unexpected problems. Factors influencing economic confidence include the rate of economic growth, unemployment levels, and house prices.

Customer confidence can also have an effect on whether an individual will take a loan. Being confident in your ability to repay the loan plays a vital role. At the same time, the confidence will determine what type of loan an individual will opt for.

Demographics and Age Distribution

Can Retirees Save More Money Than Students

Life cycle theories suggest that individuals aim to smooth consumption over their lifetime. This leads to different saving behaviors at different life stages: borrowing during student years, saving in middle age, and running down savings in retirement.

This pattern is not guaranteed, as some retirees may choose to save for inheritance purposes or due to longevity expectations.

Unexpected Events

Events like the Covid-19 pandemic can drastically alter saving behaviors. During lockdowns, many households were unable to spend as usual, leading to a surge in savings. Once restrictions were lifted, there was a strong spending surge, indicating that external events can have a significant impact on saving levels.


High inflation can discourage saving, especially if it exceeds interest rates. In such scenarios, households might prefer to spend money before it loses value or invest in assets that retain value during inflation.

However, high inflation can also lead to uncertainty and encourage saving if there are worthwhile investment options. For instance, current inflation has raised the average household spending in the UK by £433 per month on average.

Cultural Factors

Does Germany Has Higher Average Savings Than UK

Saving rates vary between countries, reflecting different attitudes towards borrowing, saving, and social expectations. For instance, countries like Germany have a strong saving culture with an aversion to debt, while the UK shows a greater willingness to borrow and spend savings.


Is saving $1,000 a month good in the UK?

Saving £1,000 a month in the UK is generally considered a good savings rate, but it largely depends on individual financial goals and circumstances. It is an effective way to achieve long-term financial goals like buying a home or securing retirement.

Is saving £200 a month good in the UK?

Investing £200 per month is a positive step towards building healthy savings habits. It is beneficial for future large purchases or as a financial cushion. Starting to save early can lead to significant growth over time, especially if the savings are invested.

What is considered wealthy in the UK?

Wealth distribution in the UK is uneven, with the wealthiest 10% of households holding 43% of all wealth. Being in the top 1% of households typically means having total wealth exceeding £3.6 million.

How much does the average middle-class person have in savings in the UK?

The average amount of savings for British adults varies with age. In 2020, the average British adult had around £6,757 in savings. The median total wealth for individuals in Great Britain between 2018 and 2020 was estimated to be £125,000, while the mean was higher at £305,000.

Closing Thoughts

The exploration of average savings in the UK reveals a complex and varied landscape, shaped by factors such as income, age, and economic conditions. While some households and age groups demonstrate robust habits, others face significant challenges in setting aside funds for the future.

Despite the challenges, the importance of saving remains paramount. It provides a safety net for emergencies, enables the achievement of long-term goals, and offers financial security and independence.