Nationwide calls on government to invest in tomorrow’s savers today

With 16 million British people having no savings at all, the forthcoming budget represents a vital opportunity for the government and savings providers to focus on the future of Britain's savers, it is claimed.

The Nationwide is calling on the Government to take the opportunity to foster a savings culture across the UK with a particular focus on encouraging children, and their parents, to save.

Savings offer consumers greater lifestyle options and a better standard of living, combined with a safety-net for those who get into financial difficulties.  Despite this, few are taking the opportunity to save, it says.

Looking closer, there also remains a worrying disparity between older and younger generations where four out of ten, 39%, of 18 to 34 year olds have no savings put aside compared to just two out of ten, 20%, of those aged 55 and over.

Nationwide looks forward to hearing further details about the new Junior ISA which will replace the recently withdrawn Child Trust Fund. Parents will know only too well how much having a child can cost but at present, there isn't any mechanism to encourage children to save, nor to encourage parents to save for their children. A Junior ISA would be a suitable, tax free alternative and one which would positively fill the gap in the market.

‘While having a mechanism to be able to save is crucial, it is of no use if people don't understand why it is important to save. Nationwide is keen to engage in government initiatives that instil savings habits in young people,’ said Robin Bailey, Nationwide's director for savings and investments.

‘Ensuring financial education is a compulsory part of the National Curriculum is vital in creating a more effective society of savers. Indeed, Nationwide welcomes the work of the All-party parliamentary group (APPG) on Financial Education for Young People who have been calling for its inclusion,’ he explained.

‘We hope the Chancellor takes this opportunity to make a fundamental difference to the future direction of savings in this country by making clear his commitment to developing a savings culture, especially amongst young people. By saving from an early age, people will be better prepared to face challenges, such as those we face today, and in turn, have a more secure future,’ he added.