Saving for a Sunny Day - UK Adults save far more for the things they want than the things they need

A third of Britons have cash savings of £25,000 or more; and putting aside money for the things we want could be key 

• Over a third of Britons have £25,000 or more in cash savings, including 31% of 18-24 year olds

• ‘Saving for a Sunny Day’ phenomenon sees more money put aside each month for holidays and new cars than emergencies 

• The average monthly saving for emergencies is just £183 a month, with 50% of the population having less than £250 in their ‘emergency fund’ 

• 58% of people have dipped into their emergency saving for non-essential items, such as Taylor Swift tickets

• Starling’s Easy Saver looks to make saving simpler

Over one-third of UK Adults say they have £25,000 or more in cash savings,  according to new research from Starling Bank, and it seems that putting money aside for life goals is the key to building up a savings pile. 

36% of UK adults have built up cash savings of at least £25,000, with 17% having £50,000 or more. And it’s not just an older generation sitting on a cash pile - almost 31% of 18-24 year olds are in the £25,000 + club. 

However, nearly a quarter (23%) has less than £500 in total savings, with exactly half (50%) having less than £250 in an emergency fund for unexpected expenses.

Saving for a Sunny Day

According to clinical psychologist Dr. Jenna Vyas-Lee, when people have specific, positive things they want to save for, they put money aside considerably faster, a phenomenon she describes as ‘Saving For a Sunny Day’. However, saving can be harder without something specific to save for. The monthly sum going into an emergency fund is £183, covering everyday essentials such as repairs, bills, and medical expenses.

Yet those saving for a holiday say they are able to put an average of £316 a month aside and £409 when saving for a new car. Those saving for a wedding put away £371 a month for the big day , while those looking for a new wardrobe put away £213 for clothes. 

The size of funds when saving for a clear goal were also bigger. A fund for those putting money aside for a holiday had an average of over £1,300 in it, compared to £987 for home improvements. A new car fund had an average of £1,594, versus £180 for money set aside for rental deposits. 

Dr. Vyas-Lee said: “Despite its importance, saving can seem like a chore. As with so many things, focusing on a positive goal can change behaviour, and language is key. So instead of ‘Emergency Expenses’, try ‘Peace of Mind Pot’. No more ‘Painting Fund’, hello ‘Interior Improvement.”

Lora Rowley, Retail Product Lead at Starling Bank said: “When people save for something that puts a smile on their face, such as a car, holiday or home deposit, our research suggests they are able to do so quicker than if they are putting savings in a rainy day fund for a potential emergency.

If people can be encouraged to think of saving in a positive way, there’s a chance they’ll put enough money aside to cover unforeseen expenses as well as Taylor Swift’s record-breaking Eras tour.”

Defunding emergencies

Despite saving significant amounts for the things they want, half of Britons (50%) have less than £250 in their emergency fund. This includes a third (35%) who do not have an emergency fund at all - rising to nearly half (48%) for those aged 18-24 and 38% of those aged 25-34. 

The research shows a clear need for an emergency fund. Nearly a quarter (22%) of UK adults have had to dip into an emergency fund for unexpected household bills or repairs in the past 12 months, while 20% have had to spend it on motor repairs and 16% for dental or medical bills. 

Even though it might be called the emergency fund, 58% of adults have dipped into it for reasons that might not be considered essential. There’s been Sunny Day Spending by 22% of adults on holidays, 17% of Britons on clothes or shoes, and 11% on takeaways (rising to 26% of those aged 18-24).

10% of all adults aged 25-34 even say they dipped into their emergency fund to buy tickets for Taylor Swift’s Eras Tour.

To help people save, Starling Bank has launched a new Easy Saver account with an interest rate of 4% AER / 3.92% GROSS for balances from £1 to £ 1 million.*

Dr. Jenna Vyas-Lee said: "While rainy day funds provide security, they may inadvertently reinforce anxiety about the unknown, which can demotivate some individuals. In contrast, saving for joyful experiences focuses on building memories and fostering well-being, which resonates more deeply with human psychological needs. This approach is less about avoiding loss and more about creating meaningful gains."

Notes to editors

Based on research conducted for Starling Bank by Mortar Research between 17th and 19th December 2024, amongst 2,011 UK adults, nationally representative.

About Easy Saver

Starling Bank’s Easy Saver is available to eligible Starling personal current account customers. This account offers penalty-free, immediate withdrawals, and an interest rate of 4% AER / 3.92% GROSS* variable on balances up to £1 million.

Easy Saver customers will earn daily interest, paid monthly, on their balances and can make immediate, fee-free unlimited deposits and withdrawals to and from a Starling personal current account. 

About Starling Bank

Starling Bank is an award-winning, fully-licensed and regulated bank, built to give people a fairer, smarter and more human alternative to the banks of the past. It offers personal, business and joint current accounts alongside Kite, a children’s card. Starling also provides a Software-as-a-Service (SaaS) proposition through its subsidiary Engine, using the proprietary technology platform that it uses to power its own bank. The Starling Marketplace offers customers in-app access to a selection of third party financial services. Headquartered in London, the bank has offices in Southampton, Cardiff and Manchester.

Contact details:

Damian Peachey

damian.peachey@starlingbank.com

T: +44 (0) 7572 036 333