Savings

We live in an uncertain world where jobs are easy to lose, incomes fragile and where relying on the state for anything more than a basic financial safety net looks foolhardy. Britons are also living longer, with retirements of 20 to 30 years increasingly common. State pension provision is unlikely to become generous; while many employers have also been cutting back on the pension deals they give their staff.

Most working people suspect they should be saving more for their retirement, but the need for savings is much more widespread than that. A survey by the Halifax showed that one in seven couples in their 20s said they didn't have the money to get married. Children are also placing even greater financial demands on parents, who may want to send them to a private school or help cover university costs.

So saving is more important than people realise. One of the biggest problems is that whilst people are putting away some of their hard earned cash, they are servicing debt at the same time - often both from the same place, and therefore applying a brake to their savings efforts. In short, research shows that for every pound we manage to save we are borrowing 83p!*

* Source: Research by RAKM for IFA Promotion, October 2004