- Tuesday, 8 June 2010Consumers should be commended for using their spare cash for
debt management but should make sure to save for the future as well.
Kevin Mountford, head of savings at Moneysupermarket.com, believes Brits need to save but this has lessened as consumers have borrowed less and felt the pinch of the recession.
He said: "Many people have been using what money they do have spare to pay off debt. This is a rational and sensible thing to do."
However, Brits should also be saving at least three months' worth of income in the bank, and should ideally aim to save up half a year's salary, he added.
Such savings would help a person survive for a few months if they lost their job or were unable to work for whatever reason.
According to research by unbiased.co.uk, savings dropped in mid 2008 from £39 billion to just £20 billion, and have not recovered since.
The latest figures released on June 7th showed that consumers are now saving just over £16 billion.
Debt levels are higher than they were in 2008 but have fallen since the end of 2009.
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