A Toluna survey on the impact of Covid-19 on savings. The survey questioned 994 adults in the UK.

KEY FINDINGS

A third of Brits are better off than they were since the pandemic began - but those with more money are far more likely to be over 65.

• 30% feel like they have more money now than they did 12 months ago.
• 27% of those surveyed said they have less money now, a year into the pandemic.
• 46% of those over 65 said that they have more money now than they did in March 2020 - compared to 27% of those aged between 18 and 65 years of age.

People who do have extra money are planning to use it wisely. 50% state that saving it ‘for a rainy day’ and 45% state that putting it directly into a savings account will be in the top 3 things they do with the additional money.

With their additional cash, the research found that:

• 40% of people plan to spend it on a well-deserved holiday.
• Just under a third (32%) plan to use the money to improve their home.
• A similar percentage (31%) are going to make use of it when lockdown ends and shops, bars and restaurants start opening again.

The biggest factor in deciding what to do with the surplus money, however, all depends on our age…

• Spending it on a holiday is one of the most popular choices among the 66+ age group (54%)
• For those aged 50 to 65 years old, 43% will save the surplus money but the same amount will likely splurge it on a holiday.
• Spending the money on property or a mortgage overpayment is a much more popular choice for those aged 35 to 49 (over a third said they’re choosing to spend the surplus money in this way, 34%).
• 31% of the youngest age group surveyed, 18–34-year-olds, stated that they too would spend any additional money in this way.

Saving money is a key priority in 2021 and beyond.

The research found that people want to increase the amount they have in savings over the next year.

Over a third (37%) of people with a savings account expect to increase the amount of money they have in there, compared with 16% expecting to decrease.

This is especially the case for people who feel they have more money than a year ago - a resounding two thirds - 66% - of them are going to increase the amount in savings.

Pension savings are getting more attention but Covid has affected those approaching retirement.

The research revealed that Brits are expecting the amount of money in their pension investment to increase.

• 29% of people expect the amount they have invested to rise
• However, Covid-19 is having an effect on those approaching retirement with one in ten 50- to 65-year-olds stating that they’re intending on retiring later as a result of the pandemic.

QUOTE

Michael Worledge, Financial Services Sector Head, Harris Interactive, said: “There is a clear divide between those that have experienced financial benefits as a result of the pandemic and those that have not, and it is those of working age that are more likely to be the financial losers. It is positive for the industry that people plan to increase the amount held in savings and we should expect strong demand for attractive savings and investment propositions, even in this low interest rate environment.”