Consumers are paying off personal debts despite the continuing recession, according to the ABI's latest Savings and Protection survey.
A third of people are repaying or increasing repayment of their non-mortgage debt, such as credit cards, in the third quarter of 2009, up from just over 25% a quarter earlier, the ABI data suggests.
Property is viewed as the best long-term investment for over half (54%) of people, the highest figure since the survey started a year ago.
Economic optimism is at its highest since the survey began a year ago among those questioned by the ABI.
Just over half - 52% - believe the economy will improve over the next year, up from just 36% who felt the same way in the second quarter of the year, and only 12% with similar optimism this time last year.
Dr Rebecca Driver, the ABI's director of research and chief economist, says: "For the long-term health of the economy, it is encouraging more people are reducing their debts.
"Increasing confidence in the value of property is also good news for the housing market.
But UK consumers still need to increase their saving levels she says: "Some 40% of people are saving too little or nothing at all for their retirement. This is very worrying.
The ABI's recently published Savings Manifesto advocates measures such as early access to pension saving and bringing forward automatic enrolment into workplace pensions to boost savings.
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