Scottish Building Society’s Savings Barometer 2025

The survey paints a sobering picture with nearly half of the respondents (46%) reporting a decrease in their savings over the past year. This decline is a stark reminder of the economic pressures many face, with three quarters acknowledging that the current economic climate has negatively impacted their finances. The cost of living crisis, coupled with stagnant wages, has left many Scots struggling to put money aside.

As well as struggling to build their savings pots, almost three in five (59%) Scots have had to dip into existing savings in the last six months to pay for outgoings. This highlights the precarious financial situation many households find themselves in, where savings intended for future goals or emergencies are being used to cover everyday expenses. This trend is particularly concerning as it weakens the financial safety nets that individuals and families rely on during times of unexpected financial hardship.

Despite these challenges, the reasons people save are as varied. From the Highlands to the Borders, savers are driven by a range of financial goals. Emergency funds top the list, with over 1 in 3 respondents prioritising this safety net - a prudent choice, especially given the current economic backdrop, where unexpected expenses can quickly derail financial stability.

Others are saving for significant milestones, such as a new home or a new car (both 17%). Milestone events like weddings and birthdays are a priority for almost 1 in 10 savers, while 11% specified other reasons, with retirement being a significant factor among these open responses.

Interestingly, almost a quarter (22%) of savers have no specific goal in mind, this could indicate a general sense of uncertainty about the future or a lack of clear financial planning.

The methods of saving are equally diverse. Regular savings accounts remain popular, with almost half (49%) of respondents using them. These accounts offer a straightforward way to save, often with some of the highest interest rates available. Easy access savings accounts are used by 44%, providing flexibility in uncertain times for those who may need to dip into the savings pot when under financial strain. ISAs, known for their tax advantages, are held by 39% of savers. These choices reflect a balance between the need for accessibility and the desire for higher returns.

The survey reveals a striking generational divide in savings behaviour. Younger savers, particularly those aged 16 to 34, face significant financial hurdles. Over three quarters of 16–24-year-olds have had to extend, reduce or put on hold their savings ambitions due to economic conditions. The pressures of rising living costs and stagnant wages are widely felt, with 70% of 25- to 34-year-olds using their savings to cover day-to-day expenses.

Lifestyle expectations also weigh heavily on younger savers. Fifteen percent of 16-24-year-olds are saving for milestone events, the highest percentage of any age group. Yet, the financial strain is evident, with almost a third of 16-24-year-olds postponing such events because they simply can't afford them. The dream of a holiday is also out of reach for many, with 1 in 3 16–24-year-olds unable to afford a break in 2025.

In contrast, older savers (65+ years) enjoy a relative sense of financial stability – indeed, a third of over-65s reported no change in their savings over the past year, the highest of any age group. Seventeen percent of over-65s are saving for no particular reason, which is perhaps a luxury afforded by years of prudent financial planning and historic property prices among other factors. This stability is reflected in the lower level of financial concern reported amongst this age group, with only 47% stating they are concerned about their ability to save through 2025 – the lowest of any age group and compared with 82% of 25-34-year-olds.

The survey highlights some regional disparities, suggesting that geography plays a role in shaping savings habits. In South Scotland, over two-thirds (71%) of respondents have dipped into their savings to cover monthly outgoings, the highest of any region. This is in contrast with Lothian, where only 55% have done the same. The Scottish Borders emerge as the most concerned about their ability to save through 2025, with 78% expressing worry, compared to 56% in Glasgow.

First-time buyers in the Scottish Borders are particularly feeling the pinch. Almost a third (30%) of respondents in this region believe they are unlikely to buy a home due to concerns about mortgage rates and their ability to save, compared to just 18% in Central Scotland. These figures highlight how local economic conditions and property prices shape people’s financial stability.