“If not having £500 of savings is a sign of financial crisis, where does that leave… all of us?”

Written by Chloe Gray

Chloe Gray is the senior writer for stylist.co.uk’s fitness brand Strong Women. When she’s not writing or lifting weights, she’s most likely found practicing handstands, sipping a gin and tonic or eating peanut butter straight out of the jar (not all at the same time).

The news that most people don’t have £500 worth of savings proves how bad the cost of living crisis has become. But when were we meant to save that money?

There are all sorts of ways to quantify how bad the cost of living crisis has become. Lurpak costs over £9 and the price of a full tank of petrol will set you back over £100. Yet it’s been hard to register these price changes in my brain. For starters, I don’t buy butter and I don’t drive, but it goes deeper than that.

At 25, living in London on a single income and with no family support in terms of housing, income or inheritance, I’ve never not felt financially squeezed. It’s meant I sometimes take a bit of an ostrich approach to bills: logging into my banking app to transfer whatever my housemate tells me I owe rather than checking the breakdown or my balance (it’s fine, I trust he isn’t ripping me off). Sure, I’ve been going out for dinner less, and ordering cheaper wine when there, but I’m also reluctant and unable to cancel plans in this ‘summer of freedom’ – especially given the two-year backlog of hen parties and festivals. 

But today’s headlines made me take note. Charlie Nunn, the chief executive of Lloyds bank, issued a statement saying that most of its customers have less than £500 of savings in their accounts. To him, this was evidence of crisis; to me, this is the norm.

It was a sign that my circumstances were worse than I thought. Suddenly, I was a poster girl for financial doom. My savings, or lack of, were being used as evidence that things in this country had got bad. Nunn said that customers “might have money elsewhere. But what we can see [in their accounts] is less than £500. So it’s a very important starting point for looking at financial resilience.”

On the surface, I’m doing pretty well. I rent a home and have a steady income. But I lack significant savings, and I don’t have money ‘elsewhere’. I have barely more than the average Lloyds customer to my name; an amount that’s risen and fallen over the years as I’ve squirrelled small amounts aside on the pay days of quieter months and spent more during squeezed periods. But the idea that I should only now think about how to be more financially resilient is what stings. 

The cost of living crisis means most people don’t have £500 saved

It implies that savings are something most of us have control over, but we can’t talk about savings without talking about wages. I moved to post-recession London almost as soon as I left university (where I’d been living off of government loans with no parental support), and got a job on a salary that barely scraped the London living wage. 

As I’ve hopped jobs in the five years since, my salary has risen slightly, but so has the cost of living. Rent, food and bills still take up most of my pay check. Yes, I’ve had holidays and bought myself new clothes along the way, and the fact that I even have a job that covers my rent and don’t have any dependents who also need feeding and clothing is a huge privilege. But when, exactly, was my salary meant to have stretched for me to save enough money to be ‘resilient’?

I have always proudly thought of myself as someone who was financially independent, despite being aware that I was living month to month. I’ve managed to make things work up until now, but it feels like there’s not much longer I can keep up the illusion that I’m empowered. 

Now my lack of savings is something akin to a crisis, I can’t help but blame myself and my habits. Something needs to change: ideally, that will be the cost of living and London wages. But most pressingly, it’s going to be how I see my financial situation. I can’t bury my head in the sand about the brutal reality of my lack of savings, but what am I meant to do about it in the midst of a financial crisis? 

Images: Getty

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