Based on the latest data from the Office for National Statistics, 78 per cent of adults in the UK do not have an ISA, meaning that over 40 million individuals are potentially missing out on GBP20,000 in tax free savings every year. Of those without an ISA, Cushon research amongst 2,000 respondents found that 22.78 per cent believe they do not save enough to make it worth having one and 21.45 per cent want their money to be instantly available when they need it. 13.30 per cent don’t want or need one and 10.81 per cent say they don’t understand ISAs so therefore haven’t opened one.
And yet, the same research conducted by Cushon found that 42.32 per cent of individuals said they do not have enough savings to feel financially secure with 31.11 per cent citing that they don’t have enough disposable income to build a sufficient level of financial resilience.
Previous Cushon research found that 78 per cent of UK adults across all age groups agree that the Covid-19 pandemic has made them realise that having accessible savings is very important. Of those who are in a position to be saving money right now, 40 per cent are putting cash aside so they have something to fall back on should the worst happen.
Commenting on the findings, Steve Watson, Head of Proposition, Cushon, says: “Even though everyone’s financial priorities are different, we do still have one thing in common and that’s the need to have savings which are accessible and available.
“Cushon is on a mission to turn the UK into a nation of savers. We want to help people build financial resilience and reach their savings goals, whether that’s getting the keys to their first home, buying a new car, saving towards retirement or having a financial buffer to fall back on should unexpected circumstances occur.
“While the majority of adults don’t have an ISA, this can be remedied through better and wider financial education to help people understand and make informed decisions about their finances and what is best for them.”
Cushon also found that 88 per cent of employers feel they should support their employees’ financial wellbeing. Thanks to auto-enrolment, most employees now have access to a pension, but many employers are now looking for more holistic solutions – helping their workforce to save for a more comfortable retirement while also supporting them with their short-mid-term priorities too.
Offering a workplace savings scheme is a great way to foster regular savings habits to help employees feel more in control of their financial situation. Employers can offer initiatives whereby the employee is able to put money aside into a savings vehicle each month straight from their pay. Employers can also contribute.