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David Neal

Household Bill and paying the mortgage are the main reasons Brits withdraw from savings

British people withdraw from their savings for very different reasons. The key point centres around whether or not you have a mortgage as those without that ver

British people withdraw from their savings for very different reasons according to a new study. The key point centres around whether or not you have a mortgage as those without that very specific pressure tend to use up savings for a variety of different reasons.

piggy bank

The study shows that British savers have a different list of preferences regarding the use they make of their savings, according to the latest survey from Legal & General.

Of those Brits paying off a mortgage, 57% of them take money from their savings account to cover increased mortgage payments, 13% do it to pay for a holiday and 11% would only withdraw money to pay household bills (including food and utilities).

Paying household bills, however, is their main concern for people without the worries of a mortgage. 45% of those surveyed would use savings to pay bills, 12% would use their savings to pay for educational costs and 11% of people would withdraw money to pay for a holiday.

Original households' savings

The survey also looked at the main reasons why we would look to save money.

Among the preferences of those surveyed, 68% of people save for a ‘rainy day'. 52% are savings for a future holiday, 50% for household bills, 45% for some sort of home improvement and 32% save in case they lose their job in the future.

Reasons including saving for a new car, as part of a deposit on a new house or for a wedding are at the bottom of the list, with 18%, 13% and 11% respectively.

The Legal & General survey also asked savers what they would do if the Bank of England (BoE) increased interest rates. "Nothing” was the response from 53% of households, 35% said they will "add to savings” and one in ten (11%) say they will "withdraw from their savings” in this event.