Families 'fail to build up savings'
The average level of savings held by families increased by just £350 in real terms in the years leading up to the financial crisis, according to research.
The rise from £750 to £1,100 between 2000 and 2005 shows that families failed to build up savings in the run-up to the economic downturn, the Institute of Fiscal Studies said.
Savings levels were particularly low among those with lower incomes and younger households, while six out of 10 families failed to put aside even a quarter of their annual earnings.
After looking at data from the British Household Panel Survey, the Institute for Fiscal Studies said significant variations in savings levels were found across the population
The richest 25% of households held average savings of £16,000 in 2005, while the richest 10% had saved a little under £60,000.
Unsurprisingly, wealth tended to rise as people got older, with families where the head was aged under 45 having average savings levels close to zero.
People aged between 55 and 59 in 2000 saved an average of 5% of their income annually in the five years to 2005, while those aged under 25 and over 75 typically saved nothing.
However, families who owned their home saw substantial jumps in their wealth during the period through house price rises.
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