14 June 2005
According to IFA Promotion, debt could be going into recession as borrowing figures have fallen to their lowest level since 2001.
However, despite this evidence of increasing financial temperance among Britons, savings do not appear to be increasing, as figures showing how much we are savings shows that we still borrow approximately 55 pence for every pound we save.
The quarterly Savings Brake report published by IFAP shows that there has been a 44 per cent drop in new debt levels since this time last year. Encouragingly, credit card debt has dropped for the first time since 1994, a sign that British consumers are spending closer to their means.
Again, however, there is little evidence, despite a slow-down in high street spending, that Britons' savings are increasing. The amount we save is still being offset by the debts we incur.
David Elms from IFA Promotions said: "Falling debt levels is always going to be good news but we would really like to see a big commitment to regular savings. Recent figures suggest a move away from the UK's 'head in the sand' attitude to spending and borrowing but the savings' brake shows that a distinct lack of joined up thinking remains.
"People are cutting back on their bad financial habits, but they need to take some positive steps if they are going to have a financially secure future", Mr Elms concluded.
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