One in 10 people don’t have any cash savings: How to kickstart a savings habit

Limited access to savings contributed to one in four UK adults being deemed as having ‘low financial resilience’, said the FCA.

Setting money aside is crucial for combatting the rising cost of living and dealing with unexpected expenses but, worryingly, one in 10 people admitted to not having any cash savings in a recent survey conducted by the Financial Conduct Authority (FCA).

This lack of access to savings to help in difficult times is just one reason why one in four people living in the UK are deemed as having ‘low financial resilience’, the regulator further revealed.

While positive strides have been made in the past few years, with a rise in basic bank account applications and lower refusal rates leading to fewer unbanked adults (i.e. who don’t hold a bank account), these latest figures suggest consumers are still struggling to make saving a habit.

Start small

Increased financial strain, in itself, can be a barrier to saving, with higher grocery, energy and fuel costs cited as some of the most common factors affecting people’s ability to put money aside, according to the NatWest Savings Index 2025. However, even saving very small amounts each month could offer greater financial stability in the long run.

“There may be an assumption that saving small amounts isn’t worth doing, when in fact saving little and often is the key to encourage the savings habit and comfortably build a safety net,” explained Rachel Springall, Finance Expert at Moneyfactscompare.co.uk. It’s generally recommended to have between three- and six-months’ essential outgoings in an emergency fund; this could lessen the impact of a financial shock, such as sudden loss of employment. 

A number of the accounts on our savings charts can be opened with as little as £1 or, in some cases, no minimum deposit at all. What’s more, some providers offer an automated savings feature that rounds up debit card spending to the nearest pound and deposits your spare change into a savings account, helping to make the process of saving little and often more seamless.

Outpace inflation

Although the number of unbanked adults in the UK fell from 1.1 million to 0.9 million between 2022 and 2024, too many people are still using a current account to house their savings.

“Recent figures from the Bank of England revealed £300 billion is sitting in UK current or savings accounts earning no interest, which is shocking,” said Springall.

“Savers may find it convenient to stash their cash in their current account, but the stark reality is that these do no work hard enough to earn decent interest, nor do they really offer the right structure to instil the savings habit,” she added.

To make matters worse, the Bank of England predicts UK inflation will reaccelerate to 3.7% by September 2025. This threatens to diminish consumers’ hard-earned cash further unless deposited in an account that can outpace the rate at which costs of goods and services are rising.

“Consumers need to shake any apathy they have and take a step back to decide how their money could work harder for them,” Springall urged.

Save flexibly with an easy access account

Fortunately, there are alternatives for those who enjoy the convenience of keeping their savings in a current account. Easy access accounts, for instance, typically allow you to add to and withdraw from your pot at any point, making them “great for savers who need some flexibility with their deposits”, according to Springall.

Currently, the top three accounts in this sector pay well in excess of 4.00% AER and can be opened with either £1 or no minimum deposit.

However, it’s important to keep in mind some accounts may apply a lower interest rate if you exceed a set number of withdrawals within a certain timeframe. The Chip Easy Access Saver, for example, permits three penalty-free withdrawals per year before lowering its rate to 2.67% AER.

Similarly, the rate paid by West Brom BS’s Four Access Saver (Issue 2) will dip to 2.15% AER from the fifth withdrawal per year, while Atom Bank’s Instant Saver Reward pays 2.50% AER in any month a withdrawal is made.

Furthermore, some accounts’ headline rates are bolstered by a short-term bonus; it’s important to check whether you’re still receiving competitive returns once this offer expires.