Abacus Daily Debt News

Public spending cuts to encourage saving?

People may attempt to save more in a bid to avoid the need for debt management because of uncertainty over public spending cuts, it has been suggested.

Adrain Lowcock, senior investment advisor at Bestinvest, noted fears on the matter should encourage individuals to place additional money aside.

The industry figure observed: “Something like that should actually increase savings, because people who are concerned about it will be more likely to save, to prepare for their biggest fear - losing their employment.”

Realities of the government’s cost-cutting measures are now hitting home, he explained, adding the public sector is likely to see more potential job losses.

Mr Lowcock maintained the problem would still persist regardless of which political party was victorious in the previous election.

His comments came in response to figures released by the Nationwide Building Society that revealed 21 per cent of consumers believe they will not be saving as much six months down the line as they are now.

By James Francis