Almost half of UK savers have been forced to dip into their savings in order to survive the credit crunch while 14% have cut back or stopped saving completely.
A survey of 2,000 British savers by Fairinvestment.co.uk found 18% of people have used up to 10% of their savings since the onset of the credit crunch.
About £281 per person was withdrawn with an average amount saved standing at £2,813.
Another 7% of Brits surveyed say they have used between 11 to 20% of their total savings, while 5% have used 21 to 30%. Furthermore, 4% have used a huge 31 to 40% of their savings.
Ominously, 5% of Britons admitted to spending between 91% and 100% of their savings, which equates to £2,560 when compared to the average amount saved.
Furthermore, 6% of Britons have ceased to save while another 8% have reduced the amount they are saving.
Sharon Bratley, chartered financial planner at Fairinvestment.co.uk, believes it is hardly surprising so many Britons have been forced to dip into their savings.
"The cost of living is going up, and so is the number of job losses, leaving Brits vulnerable and dependent on back up like savings.
"However, when savings run out, there may not be anything to fall back on. So, it's important that if people do need to dip into their savings that they only do so for essentials, keeping their savings for as long as possible," she says.
While savings rates are disappointing due to the Bank of England's interest rate cuts, fixed rate savings accounts and bonds could act as an incentive to keep savings locked-up, Bratley says.IFAonline
Cautious, Balanced & Dynamic Growth
Cowardly, boring or sensible
Latest news and analysis
‘Most significant’ upgrade since launch
Changes happening over coming months