Britons more interested in spending

Average pay deals have doubled to 2% in recent months

More than half of Britons claim they cannot afford to save, but many would not set aside money even if they received an extra £500 a month, a survey showed.

Around 52% of people said they did not have enough cash to save on a regular basis, instead claiming they would need an extra £518 a month to start paying money into a deposit account, according to moneysupermarket.com.

But a separate survey carried out for the group found that when asked what they would do if their income rose by £518 a month, only 46% of non-savers said they would start saving.

Instead, others said they would spend the extra money, blowing it on holidays, clothes, gadgets, nights out and home improvements.

The group accused people of kidding themselves about their reasons for not saving, saying many people seemed to think they should only set aside money they had left at the end of the month after they have finished spending.

Higher earners thought they would need a bigger pay rise to start saving than those on lower incomes, with people earning more than £32,000 a year claiming they would need an additional £720 a month in order to set aside money on a regular basis.

But people earning less than £32,000 a year said they would only need an extra £453 to start saving.

Around 6% of people questioned admitted that they were not interested in saving at all.

Kevin Mountford, head of banking at moneysupermarket.com, said; "Saving needs to be a positive decision to put money aside before people start to spend. Our research suggests that many people consider savings to be the money left over after they have finished spending, irrespective of how much they earn. Saving is not something that comes naturally to many people, it takes discipline and self sacrifice."

He said a good way to start saving was to work out a strict budget and see where cutbacks could be made, allocating this money to a deposit account. Opinium Research questioned 1,954 people during May for the first survey, while Omnibus Research questioned 1,954 people during June for the second survey.