Britons Strangled By Cost Of Everyday Living

BRITONS STRANGLED BY COST OF EVERYDAY LIVING 71% of Britons cannot afford to save or invest for their future 21st Century living is costing Britons dear, with over three in five people (71%), saying that the cost of everyday living means that they don't have enough money to save and invest, according to the latest study by comdirect, Europe's biggest stockbroker. At a time where working Britons are more likely than ever to fall into old-age poverty trap, and the costs of living in the UK steadily on the increase, the findings certainly underline why the UK has the second lowest savings rate in the EU1. It also suggests that people are living for today rather than tomorrow - even though saving as little as £10 per week from the age of 25 could help towards meeting the looming pensions shortfall2. comdirect asked a GB representative sample of 1,000 the reason why they are not saving or investing any money. Key findings include; · 71% of us claim not to have enough money to save and invest. This finding was even across all UK regions and age groups. · Focusing on their social lives rather than building a nest egg was a particular priority for over one in four 18-24 years olds (27%) and 17% of 25-34 year olds. · 10% of people said that they would rather spend their money on socialising and going out with friends. Perhaps worrying is the fact that 17% of 25-34 year olds, the age group that should arguably be looking at saving and investing to cover future expenses, said that they would rather be socialising than saving their pennies. · 7% of people said that they are not saving or investing because they would rather be spending their money shopping, while 6% would rather spend their money on travel and holidays. · Britons are no longer cash rich and time poor - only 2% of respondents claimed a shortage of time was a reason for not saving and investing. People living in London were three times more likely to say they did not have enough time to plan their finances (6%). Regional Findings: · Proportionately, more people in the South would rather spend their money socialising (18%). People living in the Midlands (12%) will be focusing on spending their money shopping. · The Welsh were those most likely to claim not to have enough money to invest. Over four in five people (85%) said money was too tight to invest. · Partners spending the money before they get the chance to decide what to do with it is a concern for 8% of people in Scotland and 6% in the North of the country, compared to 2% of people in the South. Regional findings: Reason why you are not saving or investing Region No Rather Rather Spend No Partne Don't Money spend it spend it on time r understand left shopping it travel spend financial after social the products paying ising money on offer bills Scotlan 79% 2% 8% 3% - 8% - d Wales 85% 7% 8% - - - - North 66% 10% 12% 3% 2% 6% 1% South 69% 2% 18% 8% 1% 2% - Midland 71% 12% 5% 8% 1% 3% - s London 82% 5% 2% 5% 6% - - John Glendinning, Managing Director of comdirect said: "Despite the fact that our daily lives are getting busier, the research suggests that Brits have enough time on their hands to invest, but are deterred by everyday expenses and the pressures to meet more immediate commitments. As the race to step on the property ladder hurtles on, we should bear in mind the horror stories of the 80s, and the necessity of building nest eggs elsewhere for our future. Investments of as little as £10 a week can make a real impact in years to come and help to ensure a secure future. We would urge people to start looking at their money options closely and start saving for the future at an early age." For further information, please contact: Rebecca Ellis-Owen/Caroline Long Financial Dynamics 0207269 7112/7269 The research was undertaken for comdirect by RSGB, a division of the Taylor Nelson Sofres Group among a GB representative sample of 1,000 adults. Facts about comdirect · Europe's biggest stockbroker, comdirect is majority owned by Commerzbank. · Fair deal pricing: flat fee of 12.50 per trade by phone and online for all account types - investment clubs flat fee of £7.50 per trade. · No annual account fee for dealing accounts. · Access to the UK and 18 international markets in Europe and North America, plus gilts, unit trusts and investment trusts, and Exchange Traded Funds · Price improvement: 80%+ of all trades are executed at a price better than the London Stock Exchange price. · comdirect has a UK market-leading platform in terms of speed of execution and sophisticated portfolio management tools, for example limit orders and stop orders. · Immediate trading - straight through online application and funding process enables an account to be opened, funded and ready to trade typically within 10 minutes. · Only stockbroker to offer zero commission on Exchange Traded Fund tracker purchases in self-select ISAs. · Embraces the highest standard for online security - 128-bit encryption. · Telephone orders for UK shares can be placed 08.00 to 16.30 Monday to Friday and for international shares 08.00 to 21.00 Monday to Friday. _______________________________ 1 The most recent comparative figures (for 2000) from the OECD are presented below: Country Gross saving as % of disposable income Austria 11.8 Belgium 16.0 Denmark 12.6 Finland 20.0 France 12.6 Germany 10.1 Greece 11.3 Ireland 23.8 Italy 10.6 Luxembourg - Netherlands 19.9 Portugal 5.4 Spain 12.9 Sweden 12.8 UK 6.9 Source: OECD Main Economic Indicators, May 2002, see pp 268-271 2 Figures prepared by comdirect show estimated build up of a capital sum made up by saving £10 or £25 per week from the age of 25 to 65, assuming 3% real growth (calculated monthly): £10 per week £25 per week Age Amount saved Amount saved 25 £0 £0 30 £2,801.36 £7,003.39 35 £6,055.46 £15,138.65 40 £9,835.48 £24,588.71 45 £14,226.42 £35,566.05 50 £19,327.01 £48,317.51 55 £25,251.93 £63,129.83 60 £32,134.43 £80,336.06 65 £40,129.25 £100,323.11 ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2002/06/17/20020617BIT00950/wkr0001.doc http://www.waymaker.net/bitonline/2002/06/17/20020617BIT00950/wkr0002.pdf