Household savings have reached a record low, with Brits saving on average just 1.7% of their earnings, according to the latest figures from the Office of National Statistics (ONS).
The ONS household savings ratio fell from 3.3% in the fourth quarter of 2016 to 1.7% in Q1 2017, having already started to decline in July 2015. The ONS said the 48% drop was partly due to an increase in taxes on income. It said: "The underlying trend is downwards, reflecting relatively strong consumption volumes, increasing consumer prices and subdued wage growth." However, as savings dropped, the household consumption expenditure ratio increased 2% to 0.97% in Q1 of 2017, just below the peak of 0.99% in Q1 2008. Meanwhile, the UK economy grew by 0.2% in the first quarter of 20...
To continue reading this article...
Join Professional Adviser for free
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes