Who has low savings and how problematic can that be?

Large numbers of households in the UK have very little in the way of savings they can easily access when they need it, despite being an object of policy concern for the government for a number of years. This was brought into particularly sharp relief by the COVID-19 pandemic, when many experienced unexpected big falls in income. With recent sharp rises in the cost of living, it will be increasingly important to understand which groups have low savings and why.

At this event we presented the findings of a new report, funded by the IFS Retirement Savings Consortium and the ESRC, looking at the characteristics of those who have low levels of financial wealth. IFS researchers presented what we know about which groups of people are most likely to have low savings and how long this tends to last. They also used data from the COVID-19 pandemic to show the extent to which a small amount of money saved can help during difficult times. After an IFS presentation of the main findings, Rob Yuille from the Association of British Insurers shared his thoughts on the research.