The report's findings underscore the complexity of factors influencing well-being
A recent report suggests that regular savings can contribute to better sleep and overall well-being. According to academics at Bristol University, setting aside a monthly amount, no matter how modest, helps individuals relax and feel more optimistic about the future. The study found that even individuals with lower incomes who save regularly experience similar levels of life satisfaction as those with higher incomes who do not save, BBC reported.
Surveys indicate that a quarter of UK adults have savings of less than 100 pounds, reflecting challenges in saving amid rising living costs, although interest rates offered by banks and building societies have improved.
Approximately six in ten people have developed a habit of saving, with charities arguing that this practice enhances financial resilience, even on limited incomes. The report from Bristol University's Personal Finance Research Centre highlights that regular saving, even in small amounts, leads to increased life satisfaction by reducing financial anxiety, minimizing the risk of debt problems, and enhancing the ability to handle unexpected expenses.
The report's findings underscore the complexity of factors influencing well-being, including existing savings levels and life stage. While saving contributes positively to life satisfaction, major life events such as moving homes or marriage have a more significant impact on mental well-being. Conversely, events like job loss or becoming a parent can create greater mental health challenges.
Interest rates on savings accounts have seen improvement recently, with easy-access accounts averaging 3.12% and one-year fixed-term accounts averaging 4.65%. However, expectations of lower benchmark interest rates from the Bank of England in August may reduce these returns.
Andrew Gall, head of savings at the Building Societies Association, emphasized the importance of encouraging everyone to save, if possible, noting the benefits outlined in the report. The report suggests that savings providers should offer straightforward, flexible savings products and use incentives to encourage saving among customers.