There is a significant spike in the number of middle income earners and middle aged Brits who are now having difficulty maintaining a healthy level of savings. In fact, the figure has doubled when compared to the figures that we had a couple of years ago. Coupled with this prevailing trend, stakeholders in subprime lending business are taking the cue and making significant moves to expand their investment in this market niche with the expectation of more consumers seeking for payday loans and similar subprime financial tools.

Important Facts and Figures

So, how can we define the current financial position of our elders? The numbers don’t give us much reason to be hopeful as far as middle-aged and middle income earners are concerned. 4 in every 10 Brits that fall under the age bracket between 45 years old and 54 years old are not able to set aside portion of their income as savings. This situation can be attributed to the financial difficulties of young adults and elderly parents.

This is the main reason why experts refer to consumers under this age category as belonging to the sandwich generation. Middle-aged and middle income earners are weighed down by this 2-tier financial burden making it difficult for them to make substantial contribution to their savings portfolios and pension. In fact, this age bracket accounts for the highest number of consumers who are not able to tuck away part of their income as savings. This is equivalent to an astounding 3.5 M consumers across Britain.

Breaking Down the Numbers

But it is not just the middle-aged who are struggling with their savings portfolios. This may come down as a shocker to most of us – Despite the prevailing notion that low-income earners are most likely the lead non-savers, Brits that are performing within the £20,000 to £30,000 income range are struggling with their respective savings portfolios.

About 30 percent of these middle income earners are not making any savings at all and those who are able to set aside for the “rainy days” are actually tucking away a paltry 5 percent or even less of their monthly income. Most consumers cite the high cost of living as the main reason for not saving. And the situation is further aggravated by the benefits that were recently withdrawn.

Just last year, cuts were applied on child tax credits. In fact, the situation has gone from bad to worse with the withdrawal of child benefits for families that are considered higher tax rate payers. This negative policy is applicable even if the other parent is a non-wage earner or receiving a lower wage. Thus, it is not surprising that this ongoing financial crisis has seriously affected the capacity of consumers to save. It has, in fact, spawned a new generation of consumers who have lost the appetite to save. It is now the paramount concern of all to impress upon this new generation of non-savers to understand the full implication of their spending behavior on their financial position.