Over 16 million UK workers have less than £100 in savings: FCA
More than 16 million working people in the UK have less than £100 ($128) in savings, while roughly 17 million people are unable to pay off their monthly credit card balances, according to a report by the Financial Conduct Authority (FCA). "There is a huge crisis with personal debt that the government has ignored for far too long," said Labour MP John Mann, a member of the Treasury Select Committee.

More than 16million working Britons have less than £100 held in accessible savings accounts.

And more than 17million do not pay off the monthly balance on their credit cards, allowing banks to pocket billions of pounds in interest.

The figures revealed in a damning official report last night paint a worrying picture of consumers spending far beyond their means.

Critics said the findings, in a study by the Financial Conduct Authority (FCA), were an indictment of the UK’s debt-fuelled economy, adding that they showed that it was time for ultra-low interest rates and lax borrowing rules to come to an end.

Labour MP John Mann, a member of the Treasury Select Committee, said: ‘There is a huge crisis with personal debt that the Government has ignored for far too long.

‘We need to make sure that vulnerable customers are not taken advantage of.’

Many people in the UK have no more than £100 in instantly accessible savings, and millions fail to pay off their monthly credit card bills

Susan Hannums, of adviser Savingschampion.co.uk, said: ‘It’s little surprise that people are saving less as they clearly don’t have the money to do so or the inclination with rates are such low levels.

‘But the reality is it’s a ticking time bomb if we don’t do more to help and encourage people to put money aside for their future.’

Ultra-low interest rates have left savers struggling to beat inflation, while the big banks tempt shoppers to spend beyond their means with interest-free credit card deals.

PEG PENSION AGE AT 68, SAYS TSAR Raising the retirement age beyond 68 for those now in their 30s would be wrong, the Government's pensions tsar warned yesterday. John Cridland, former head of the CBI, said pushing the state pension age back to 69 or 70 would be too much. Issuing a clear warning to ministers, as they prepare to announce the new state pension age, Mr Cridland told the Evening Standard: 'Going beyond 68 would be too big a change for this generation to bear because for some women their expectations will have move from 60 to 68 and for men, from 65 to 68. There is only so much one generation can bear.' The state pension age started rising in 2010. It will be 65 for men and women by next year and is currently sceduled to rise to 68 by 2046. Mr Cridland said this target should be brought forward to 2039 to ensure 'intergenerational fairness'. In a report last month, he said older people have a duty to work for longer - otherwise their children will have to pay their consequences. Mr Cridland has also called for the scrapping of the 'triple-lock' that guarantees the state pension rises annually by the highest measure out of average wages, inflation, or 2.5 per cent. Couples turning 50 who have not started saving for a pension need to put aside £633 a month for a comfortable retirement, a report warns. This is nearly five times the £131 a month for couples who start saving at 20. It is required to help achieve an annual retirement income of £26,000. For this, a couple would need a pension pot of £210,000 on top of their state pension of £159.55 each, which those aged 50 now will receive at 67. The WHich? study found that retired couples need £18,000 a year to pay for essentials or £26,000 to allow for extras such as holidays. Advertisement !- - ad: https://mads.dailymail.co.uk/v8/ru/news/none/article/other/mpu_factbox.html?id=mpu_factbox_1 - ->

Research by the Government-backed Money Advice Service found that four in ten working-age people – 16.8million – had less than £100 in savings available to them in instant access accounts at any time. Around 30million use credit cards and 58 per cent – 17.4million – do not pay off their balance each month. In 2014 an FCA study found that 2.1million were in arrears or had defaulted on their credit card payments, and there is no sign the situation has since improved.

Another 2million consumers had spent 90 per cent of their available credit, suggesting they were only just keeping their heads above water. And 1.6million were only making minimum repayments – meaning it could take decades to clear a debt and huge amounts of interest would be going to the banks.

Yesterday FCA boss Andrew Bailey raised fears that demand for credit in today’s world is higher than what is ‘sustainable or sensible’.

The issue has become increasingly prominent since the Bank of England cut interest rates to a historic low of 0.25 per cent after the Brexit vote. It means that savers cannot earn a decent return – or even beat inflation, now at 2.3 per cent. Meanwhile, there are concerns that borrowers are storing up disaster for when interest rates inevitably rise and the cost of servicing their debt shoots up.

Lenders have come under criticism for promoting irresponsible behaviour by offering cards which charge no interest for up to 30 months.

Credit card debt rose at the fastest rate for 11 years in February, with shoppers piling another £562million on plastic – £20million a day. British families now owe a record £67.3billion on their credit cards, around £2,500 per household.

Justin Modray, of consumer group Candid Money said: ‘There are increasing numbers of people who have almost no savings at all and are taking on significant debt.

‘It’s a worrying trend that shows no sign of abating.’