One in ten UK adults have no savings at all, according to new data from the financial regulator, which highlights a divide between rural and urban areas when it comes to money.
The Financial Conduct Authority FCA’s financial lives survey for 2017 shows that across the UK in general, 12 per cent have no savings or investments, while one in eight adults have no cash savings whatsoever and one in three only have savings of between £1 and £1,999.
There is a stark north/south divide in savings, according to the survey, with 17 per cent of adults in the northwest and 16 per cent in the northeast without savings, compared to 9 per cent in the southeast and 10 per cent in the southwest.
The area with the highest proportion of adults who have no savings is Tees Valley and Durham, at 18 per cent, while in areas including Devon, Berkshire, Lincolnshire and outer London, just 7 per cent of adults have no money saved.
The research shows that people living in rural areas are more likely to be satisfied with their overall financial situation, but they also report difficulty in both accessing bank branches, and using online banking. The uptake of mobile banking was 23 per cent in rural areas, almost half the use in urban areas (45 per cent).
Hannah Maundrell, editor in chief of money.co.uk, noted that there has been an “alarming number of bank branch closures recently”; recent data shows almost 3,000 bank branches have been shut since 2015.
Ms Maundrell added that the closures were “especially bad news for those in rural communities who don’t have the best access to fast-speed internet or mobile phone signal”.
“The lack of branches coupled with a lack of decent broadband and mobile signal in rural communities could create a perfect storm and really needs to be investigated,” she said.
Meanwhile, 49 per cent of people in urban areas show characteristics of “financial vulnerability” compared to 54 per cent in rural areas, the FCA said.
Jane Goodland, a director at money management firm Quilter, said the statistics “should act as a very serious wakeup call” in showing how financially unstable many UK families are.
The key to combating this vulnerability, she said, is financial education, which should be a “compulsory element of the national primary school curriculum to help address the nationwide financial knowledge gap”.
“Government needs to scrutinise figures from the FCA’s survey as a matter of urgency. Battling feeble financial resilience should be at the top of its to-do list, no matter the political backdrop and despite all eyes being on Brexit,” Ms Goodland added.
FCA boss Andrew Bailey said the data was important for financial firms in deciding how to operate for customers in different areas, as well as in shaping policy.
“This survey shows just how different the experience of financial services is for consumers across the country,” he added.
