Survey: Brits 'more committed to spending than saving'
By UK CreditCards.com
People in the UK are twice as committed to spending on their credit cards as they are to saving, new research suggests. A survey by Standard Life found that the average person spends £3,804 on credit card payments each year, while a typical saver puts away just £1,680.
The findings highlight the importance of using the most suitable credit card to help manage outstanding debts, say experts.
card payments exceed savings deposits
The average person with credit cards spends £317 on card payments each month, according to the latest study by Standard Life, which asked research firm YouGov to survey 2,016 adults earlier this year. Meanwhile, the average saver puts just £140 into their savings account each month.
The survey also revealed that people who make monthly credit card repayments typically spend nearly nine minutes per day thinking about these payments, whereas savers think about their nest eggs for less than 3.5 minutes per day, on average.
debts 'need to be managed well'
John Lawson, a spokesman for Standard Life, said that people with credit card debts need to manage their money well in order to prevent debts from mounting up. However, observed Mr Lawson: "Some people may be using their credit cards really effectively, paying them off each month and not splashing out on nights out or designer items that they really can't afford."
Mr Lawson also stressed the importance of savings, as a healthy savings account can help to prevent people from falling into debt in the first place. However, he emphasised: "Obviously paying off any credit card debt you have should always take precedence over savings."
should shop around for most suitable card
Britons' apparent fondness for credit cards also highlights the importance of using the most appropriate card. For instance, those who manage to pay off their bill in full each month may want to consider taking out a rewards card, such as one that provides cashback or loyalty points, that they can use to save on other purchases.
People who are considering making a large purchase that they plan to repay in instalments may be better off using a 0% purchase card, as this will give them several months interest-free.
Finally, consumers with existing credit card debts should try to move their outstanding balance on to a credit card that offers 0% on balance transfers for several months. This will give them extra time to pay off their debt without accruing interest.
Published: 5 October 2011
- Credit card debt weighs heavily on pensioners – Pensioners on fixed incomes are turning to credit cards to make ends meet -- and many are finding themselves trapped in a cycle of debt ...
- How payments have changed during the Queen's reign – This summer, Queen Elizabeth II celebrates 60 years as a monarch. A lot has changed in the payments world since she took the throne. Here's a look back ...
- Are payday loans replacing credit cards? – Payday loans have a bad reputation. Yet many UK consumers may be turning to them now that it's more difficult to qualify for a credit card ...