By James Rodger

Copyright birminghammail

A warning has been issued to ALL UK households who have less than £2,000 savings . Having less than this amount means you are more likely to face financial hardship, it has been warned. A new study has found households that save consistently, regardless of the amounts, have over 70% lower odds of falling behind with their bills than non-savers. The research was based on analysis of the longitudinal data in the Understanding Society survey. While the report highlights £2,000 as an important protective threshold, it also suggests that this target should not be seen as a minimum requirement. READ MORE UK national speed limit could be slashed in ‘half’ with all drivers warned Andrew Gall, Head of Savings and Economics at the Building Societies Association, commented : “Building a financial buffer is one of the best protections against life’s ups and downs. “This important report shows that having £2,000 in savings can more than halve the risk of falling into financial difficulty. However, it also reminds us that even small sums make a real difference, at a time when one in ten people have no savings at all. “We appreciate that for some families £2,000 may feel out of reach right now. But the research has demonstrated that even small, regular savings, such as £10 a month, will build resilience over time and improve people’s wellbeing. “Just as important, the findings show how a simple savings account is often the first step to achieving longer-term financial goals. People with good savings habits are far more likely to go on to have other savings and investments, which in turn can lead to positive outcomes such as becoming a homeowner. “And this report makes clear that there’s more we can do. From payroll savings to better financial education, there are practical steps that can help the nation have better savings habits. “Everybody’s savings journey has to start somewhere. That’s why UK Savings Week is all about helping individuals to build a habit that works for them.” Sara Davies, Associate Professor at the University of Bristol and part of the Personal Finance Research Centre team who worked on this research, added: “This research reaffirms the protective effect of holding a financial buffer, giving households a bit more room for manoeuvre should they face an unexpected expense or shock to their income. “We hope that the report acts as a call to action for policymakers and those working in financial services to find new, innovative ways of supporting households – especially those on lower-incomes – to build a savings habit.”