Study reveals north-south divide for savings

06 December 2011 15:41:43

Southerners' savings accounts tend to hold more than northerners'.

Consumers in the south of England are saving more than their northern counterparts, according to the latest research from Halifax. The savings provider's latest report indicates that the average southerner has approximately £1,000 more put away for a rainy day than the average northerner. Here, CompareandSave.com takes a look at the key findings of the report.

Southern households out-saving northern ones
People in the south of England are out-saving those in the north of the country by almost 13%, according to the latest Halifax Savings Report. The research, which looked at savings accounts held with Halifax in October 2011, reveals that the average customer in the south had £8,734 in their savings account that month. This compares with just £7,759 in the average savings account in northern areas of the UK and does not take into account the estimated 30% of households that have no savings whatsoever.

On a regional basis, the biggest savers currently live in East Anglia, where average savings account balances total £9,172. In contrast, people in Scotland typically have just £7,332 in savings, dropping to £3,579 in North Lanarkshire.

Gender divide also apparent
The Halifax research also highlights differences in saving habits between men and women. Women tend to have slightly more in savings than men - £7,981 versus £7,657 - and the only regions where men are out-saving women are Scotland and the north of England. Certain local areas have particularly noticeable gaps in saving, with average female savings account balances in Waverley in Surrey being 28% higher than those held by men.

Clear gender divide for savings relative to earnings
While the average UK woman only has about 4% more in savings than the average man, the Halifax report shows that women tend to save much more as a proportion of their earnings. Females' savings account balances are typically equivalent to 40% of their gross annual earnings, while men have an average balance of just 23% of their earnings.

While the exact figures differ across the country, this overall pattern is repeated across all regions of the UK. Halifax proposed two factors that probably explain this trend. Firstly, some high-earning husbands transfer savings into their wives' names in order to reduce the amount they pay in tax. Secondly, older women may acquire savings when their husbands die.

Halifax economist Martin Ellis said: "Whilst women typically have slightly higher savings balances than men, the difference as a proportion of earnings is quite substantial. Female savers seem to be managing to devote more of their earnings to savings. Saving habits can differ greatly, with many savers putting away spare cash for an event such as a holiday or wedding, however, it is still important to plan for the long-term future, such as saving for retirement."

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