People are spending more on their credit cards each month than they’re putting into savings, according to new research from Standard Life.
The study found that UK credit card holders spend around £317 per month on credit card repayments, whilst they only put an average of £140 per month into savings accounts or Isas.
If this pattern continued over a 40-year period, Standard Life’s analysis finds that savers would have put away £67,200 but spent £152,000 on credit cards.
The research also revealed that whilst 44 per cent make a monthly deposit into a savings account or Isa, 51 per cent are tied to a monthly credit card payment.
Commenting on the results, Standard Life’s John Lawson said, “Our research suggests that people are not thinking about their savings and Isas as much as they could be. If they are spending over £152,000 on their credit cards on average, there’s a strong chance that some of this money could be better managed and invested for the future.”
He said that paying off debt on credit cards should be a priority before putting money into savings accounts or Isas.
The findings seem to contradict the perception that consumers are clinging onto their cash and paying down debt because of worries about the economic climate. However, there are concerns that many people may in fact be using credit cards to pay for everyday living expenses.
