Savings suffer as Brits pay off debt

British savers are abandoning the search for the best savings rates in favour of paying off the debt that they owe.

A survey carried out by unbiased.co.uk found that Brits repaid 19p of debt in every pound they saved during the first six months of 2010.

Between July and August people saved 16p and during the last three months of 2010 this dropped to 14p.

The organisation said that the results of the survey show that consumers are conscious of their debts and are working hard to pay them off.

But it appears that savings levels have been affected by people looking to become debt free as the amount of money saved between January and March has dropped to £15 billion from £20 billion in the first three months of 2010.

Karen Barrett, chief executive of unbiased.co.uk, said: "This trend highlights a real concern for the nation's personal finances as we see people dipping into what is essentially their financial safety net."

A recent survey by Scottish Widows found that the recession and economic difficulties have created a generation of lost savers who simply can't afford to put money away.
 

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2011-03-08 11:05:07 © Moneyextra.com