
Many are on the brink of financial crisis
One in 10 Britons say they are on the brink of a financial crisis and one in 50 are already in one, according to the latest annual financial resilience report from Royal London.
Mid-life adults aged 30 to 49 are the worst affected age group, with 16% either in or close to a financial crisis.
Only two-fifths, 41%, of the age group are satisfied with their standard of living.
Families with children under 18 are under acute pressure with almost half, 47%, saying they are close to financial crisis or are feeling the pinch.
Royal London said one of the most concerning findings in its report is that one in five adults have less than £100 in cash savings, a figure that has remained unchanged for two years. With little or no financial buffer, these individuals are highly vulnerable to rising costs and unexpected expenses, the mutual insurer said.
The income squeeze has also impacted savings and retirement planning. But, encouragingly, only 5% of adults reduced or stopped pension contributions in the past year
However, 43% of adults admitted that their pension or retirement plans have been affected by the higher cost of living. The report also reinforced the need to encourage people to engage with their pensions, as 69% of adults do not know how much is in their defined contribution pension pot, while 52% have not thought in the last year about how much money they may need for retirement.
Sarah Pennells, consumer finance specialist at Royal London, said: “After more than three years of rising costs and higher bills, we’re seeing the impact on people’s longer-term finances, as well as their day-to-day spending.
“It’s very concerning that one in five have less than £100 in savings – exactly the same percentage as in March 2023 when we first asked this question, and unchanged for the past two years.
“We’re seeing a big divide between those who can absorb higher costs and those making daily sacrifices—cutting back on essentials, dipping into their savings, or going overdrawn at the end of the month.”
• Figures from YouGov Plc. Total sample size was 4,003 adults. Fieldwork was undertaken between 26 February - 5 March. The survey was carried out online. The figures have been weighted and are representative of all GB adults (aged 18+).