Brits urged to keep savings for a rainy day

While many people are concerned about staying debt free, over a quarter of British people may be risking debt problems by spending spare cash on holidays rather than saving it.

According to research from Abbey Savings, 26 per cent of respondents believed a trip away was the best way to spend excess cash.

In total, 62 per cent of the population use their savings for holidays – equating to £50.4 billion. The bank estimates this is losing savers £32.2 billion in interest if money is taken from high-interest accounts.

Reza Attar-Zadeh, director of savings and investments at Abbey, said consumers should take advantage of “excellent” interest rates available and put cash away – advice which could help prevent debt in the future.

“If people cut back a small proportion of the amount they spent on holidays and kept their savings, this would make a real difference to their financial wellbeing.”

In other news, this week Abbey has also urged parents to protect their homes against damage caused by toddlers.

By Morwenna Kearns