Saving money in today's economic climate can feel overwhelming and challenging for many. With rising costs, global unrest and an economy in flux, savings can be one of the first areas of our personal finances to take a hit.
To understand how Scots are being affected, here at Scottish Building Society, we’ve undertaken a comprehensive survey of 1,000 people to understand attitudes to savings across the country.
The Savings Barometer aims to provide insights into the financial habits, challenges and opportunities faced by savers in Scotland in 2025. The report highlights key findings and trends, offering a detailed look at how different demographics and regions are navigating this testing economic landscape.
A nation under financial strain
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.
The diverse landscape of savings goals
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.
Generational differences: A tale of two savers
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 regional divide: savings across Scotland
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.
Our tips for saving in 2025
- Prioritise emergency funds - given the current economic climate, it's crucial to have a financial safety net. Aim to save at least three to six months' worth of living expenses in an easily accessible account. This will help you cover unexpected costs without dipping into long-term savings or investments. Consider a savings account with a high rate of interest to maximise your returns while keeping your funds accessible.
- Automate your savings - one of the most effective ways to build your savings is to automate the process. Set up automatic transfers from your current account to your savings account each month. This ensures that you consistently save a portion of your income without having to think about it. You can also automate contributions to your ISA or pension, helping you grow your savings and investments over time.
- Review and adjust your budget regularly - regularly reviewing your budget is essential to ensure you're on track with your savings goals. Take the time to assess your income, expenses and savings contributions. Look for areas where you can cut back or adjust your spending to free up more money for savings. Additionally, keep an eye on changes in interest rates and financial products to ensure you're getting the best returns on your savings.
Bridging the gap
A common theme emerging from the study is the role that age plays in the ability to save. Whilst this might be somewhat unsurprising – older people have been working longer and have had more time to build up savings – the findings highlight the importance of developing financial literacy skills at a young age.
When asked what motivates them to choose a savings product, only 29% of 16-24-year-olds prioritise interest rates and product range compared to 57% of those aged 65+. There could be various factors at play here, but with 3 in 4 16-24-year-olds postponing or reducing their savings ambitions due to economic conditions, a greater understanding of the impact of interest rates could help younger savers make better decisions.
Paul Denton, chief executive of Scottish Building Society, said: "We can’t ignore the role age plays in financial resilience, particularly during such a challenging time for the economy.
Some of the findings suggest that the growing complexity of the savings market is making it even harder for young people to get ahead, underscoring the need for straightforward savings products and on the provision of financial education at a young age."
With the rising prominence of ‘finfluencers’ (financial influencers) on platforms such as TikTok and Instagram, younger savers are at greater risk of misinformation, making it essential that the UK’s trusted financial institutions communicate with their audiences in the right places.
This places a greater importance on making sure young people know where to go to access credible information and support.
Looking ahead: the financial outlook for 2025
As we look to the future, the economic outlook for 2025 remains uncertain. Market conditions continue to constrain people’s ability to save, with only 5% of respondents managing to save more than they had planned in the past year.
Mr Denton calls for government intervention to protect savers: “Market conditions are constraining people’s ability to save despite a clear appetite to do so. It is vital that the UK Government recognises these conditions and protect savers from additional tax constraints. In particular, the Cash ISA needs to be given protection from changes to give people the confidence to make sound long-term financial decisions.”
The survey reveals significant concerns about the ability to save throughout 2025, with over two thirds of respondents expressing worry. Higher interest rates and having more money are the top factors that would encourage people to save more, but with the economic outlook making this unlikely, savers may need to revisit their plans.
In summary
The Savings Barometer provides a comprehensive snapshot of the financial challenges and opportunities facing Scottish savers. From generational differences to regional disparities and the impact of financial literacy, the findings highlight the need for targeted support and education.
Scottish Building Society remains committed to supporting savers and promoting financial well-being. By offering accessible savings products and educational resources, we aim to help Scots navigate the economic landscape and achieve their financial goals.
Methodology
This research was conducted on behalf of Scottish Building Society by Censuswide, among a sample of 1,000 nationally representative Scottish consumers (aged 16+). The data was collected between 16th April - 23rd April 2025. Censuswide abides by and employs members of the Market Research Society and follows the MRS code of conduct and ESOMAR principles and is also a member of the British Polling Council.
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