£238billion stashed away by UK savers so far
Since the first lockdown in 2020, it’s reported that households across the UK have saved a massive £238bn. The Office for National Statistics (ONS) stated that while Britain’s GDP crept downwards over 2020, UK savers squirreled away billions. With very little to spend money on – except perhaps toilet roll! – we’ve had nothing better to do than stash our disposable income. On average, UK household saving as a proportion of household income has been massive: record 16.3% in 2020, up almost 10% from the 2019.
…but are you being short-changed keeping cash?
Natwest research has pointed out that 83% of parents and guardians putting money aside for their children’s futures are doing it with cold, hard, cash.
But there is a hidden danger to using cash for long-term saving. Peter Flavel, CEO Coutts & NatWest’s Wealth Businesses, said: “the concern is that the customer isn’t aware that the impact of inflation means the purchasing power of these ‘safe’ cash balances actually goes backwards over the longer term.”
So the major issue with these billions saved over lockdown is the fact you aren’t being rewarded with growth. Fewer than one in four parents are investing (rather than “saving”) for their children. Today, savings accounts are the digital equivalent of putting your money under your mattress. But of course, growing those savings isn’t difficult if you put them to work in the right way. Multi-year bonds that let you grow your money with a fixed interest rate are becoming more and more popular as a form of passive investor growth. So you can grow your money – just probably not on the high street.
UK set for £22billion boost to tourism
If you’re looking to use some of that cash for some well-needed fun, now’s the time to take a UK holiday. As international travel is still cautious (and our traffic light list system is changing almost daily), the UK is looking at a super staycation summer. After a year of no holidays, Brits are set to spend a little more to enjoy the finer things. Domestic tourism could be up as much as £22billion this year, and hoteliers – including world-leading brands like Hilton and Marriot – are in the prime position to attract the British holidaymakers who would usually opt for a foreign holiday.
“We are delighted to be welcoming back leisure guests to our properties in England, after what has been the toughest year in the hospitality industry’s history. With pent-up demand for a safe summer of travel, we are excited to be able to welcome British holidaymakers back to Hilton hotels once again, offering best-in-class hospitality, cleanliness and booking flexibility.”Stephen Cassidy, managing director of Hilton UK and Ireland
Ben Godon, head of the Hospitality Asset Management team at Colliers, said that the predictions in their UK Staycations 2021: A Year of Opportunities report were drawn by the levels of increased business on the books of the luxury hotels looked after by his team. He continued:
“For the forthcoming three months there have been at least double the bookings that there were for the same time in 2019, and in some instances, there have been three times the amount. It looks like it will be a bumper summer season for some locations, which is very welcome news indeed.”
Recommended Read: Yes, 3 Year Bonds are brilliant. Here’s why.