Research from the P2P lender found that a third of UK residents are not saving or investing.
Most people in the UK aren’t saving enough and those who are probably need to save more, new research from peer-to-peer lender Ratesetter found.
While the majority of people think they would be able to live off of the interest on £1m, Ratesetter says you would need 18 times that amount to live comfortably, if you’re investing in a savings account. The £1m in a savings account would only earn £1,400 a year in interest.
The research, conducted by Opinium Research, also found that a third have not saved or invested in the last three months. The savings rate was even more stark among women. While on average men saved £296 a month in the last quarter, women only saved £170 a month.
“This research highlights a serious concern: a worrying number of people are failing to make any provision for the future,” said Peter Behrens, chief operating officer and co-founder at RateSetter. “This not only means that they risk being caught out by an unexpected bill, but also miss out on long term returns.”
People are also discouraged to save due to the low returns on cash accounts, the survey of 2,002 UK adults found. Of those surveyed, 43 per cent said that low returns meant it was not worth saving.
The reports are just the latest research that RateSetter has done to raise awareness of investing for savers in the UK. The survey also found that those aged 25 to 34-years-old put away the most over the last quarter (£278 a month), while young adults from 18 to 24-years-old put away the least (£154 a month).