More people saving for a holiday than a rainy day, survey finds

A survey by BM Savings has found that more people are putting money aside to pay for a holiday than for a `rainy day` - potentially limiting the amount of protection they have against debt in an emergency.

In the last three months, 31% of the population have been saving for a holiday, compared with 25% saving for a rainy day. Other popular reasons for saving include for retirement (14%), to pay for a car (10%) and for a house deposit (9%).

The survey also found that more than half (52%) of Britons are concerned about how inflation could affect their savings. Indeed, the average amount saved fell during the last three months, compared with the previous three-month period, down from £768 to £754.

An expert at debt management company Gregory Pennington said: "It`s very encouraging to see so many people saving money, rather than taking on debt, to pay for things like holidays, cars and weddings. However, it`s less encouraging that only a quarter of people are putting money aside for a `rainy day` emergency.

"When money gets tight, whether that`s due to higher outgoings or a fall in income, savings can make it much easier to get by. Without savings, a lot of people end up falling behind on important payments and getting into debt.

"That`s why we urge anyone who can afford it to make sure they regularly put money aside for an emergency. Experts tend to recommend having at least three months` salary in a savings account - and it is basically a case of the more, the better - but any amount is better than nothing at all."