Savings increase as spending falls

In research published by Birmingham Midshires earlier this week, it was revealed that on average, we are saving more than we did this time last year. The figures show that in the first three months of this year, we collectively saved an average of £938 compared with £910 for the same period last year.

These figures are somewhat surprising when the recent increases in food and fuel are taken into account, and just shown how much consumers are worried about the immediate future.

Tim Hague, Birmingham Midshires director of savings and investments has urged consumers to be on cautious about dipping into their savings balance in the current climate.

However, opinion is divided, with some believing that increases in savings balances are not solely due to consumers being prudent. It has been suggested that one of the spin offs of mortgage lenders having to rely on retail balances to continue lending has been the sudden appearance of new attractive savings schemes from the major lenders.

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