Do You Have Enough Savings to Cover a Period of Unemployment?

Research reveals a worrying 29 percent of British workers are nervous about being made redundant in the next 12 months.  Are you concerned over the stability of your job, and if so have you got adequate savings in place to cover a sudden lack of income?

The study by HSBC showed even more people are concerned about their job when looking into the next three years, with 37 percent claiming to feel vulnerable to redundancy.

The median weekly gross salary is £499 according to the High street bank, meaning the average saver would have to have £1,667.25 in savings to accommodate their standard of living per month without an income.

ìWe are in a difficult financial period with many people feeling insecure about their job prospects and experiencing a squeeze in their standard of living,î said Richard Brown, HSBC senior savings product manager.

ìWhile this feeling of a lack of job security is particularly acute among older people in the public sector, everyone seems to be feeling the squeeze on their finances.î

Around a third of workers in both the public and private sector admit to now borrowing more than they did six months ago.  For 28 percent it is to help pay for mortgage payments or rent.  This rises to 30 percent of private sector workers borrowing this way, compared to 25 percent of public sector workers.

Figures from a money comparison site also show the use of payday loans is up by 58 percent since the May Day bank holiday, indicating the nation found the back to back bank holidays a strain on their finances too.

The latest inflation report from the Office for National Statistics also reveals inflation is higher than expected in April, with the CPI rising from 4 % to 4.5 %.

Possibly as a result, almost a third of workers are saving less than they did six months ago, or as some experts suggest, they are focused on paying off debts before the base rate rises.

How is the current economic climate affecting your ability to save?  Do you think your savings could support you financially for a period of unemployment?

 

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