Wednesday, 4 March 2009

The lost art of saving

In 2008, UK households saved virtually nothing. Certainly, there were some people who put a few quid away, but as a nation as a whole, we stopped saving.

The future? Growing old? Well, that is something that happens to other people. We spend now, hoping that someone else will look after us when we go gray and saggy.

Or perhaps the spenders got it right. With the equity market collapsing, banks failing, and interest rates on deposits now zero, the rational thing was to spend. If anyone did try to save, the likelihood was that the accumulated wealth would be destroyed by crashing asset prices.

Nevertheless, I can't help feeling that this country is heading for a terrible reckoning for the excesses of the last ten years. Poverty, particularly in old age, is the future waiting for the great spenders of this generation.

6 comments:

Anonymous said...

dont worry, the savers will cushion the fall of the spenders so we can all eat dry toast together..except for the criminal financiers of course..they can have cake.

electro-kevin said...

Awaiting ALL of us.

Friends report that their parent's fortunes are being exhausted by care home costs. The old people on the same wing who pee'd it up the wall all their life get their care funded by the state.

You really think your savings belong to you ?

Anonymous said...

They will both feed you and put a roof over your head in in jail....

mike said...

There is still 550 billion+ of deposit account savings out there. That could buy a lot of cheap houses.

In January 2.3 billion was withdrawn from deposit accounts which suggests a squeeze.

OSR said...

That chart looks much like its American counterpart. The upside of a depression is that if nobody has money, everybody has money.

Anonymous said...

Take your money out of the UK and make sure you don't retire there. Simple. The UK sucks anyway as a place to live, it just about cut it as a place to work when the pound was worth over two US dollars. But now? Leave.