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Press comment: ONS data shows money worries mean borrowers twice as likely to feel anxious during pandemic

15/06/2020

If you are covering today’s ONS data that shows the number of people experiencing high levels of anxiety has risen during the Covid-19 pandemic, please see the following commentary from Rachael Griffin, tax and financial planning expert at Quilter.

The data shows 30% feel their household finances have been affected by the coronavirus. Those who said they “needed to borrow money or use credit” were 2.2x as likely to report high anxiety, and the odds of feeling high anxiety were 1.7x as great for those who said their “pension was being affected”.

Rachael says:

“The Covid-19 pandemic has been a major shock to the economy. Millions of people have experienced a fall in income through either furlough or redundancy, and the economy fell off a cliff edge in April with the country in lockdown.

“At the same time we experienced a sharp decline in global stock markets, damaging investment values. This is a particular concern for retired people who are likely to have the most immediate need to generate income from their pension investments.

“It is no surprise then that almost one in three people reported that their household finances had been impacted by Covid-19. Those that are borrowing money are more than twice as likely to report feeling anxious, and there is also a higher level of anxiety among those people that said their pension had been affected.

“Evidence shows that around 11 million people have only £100 or less in savings to fall back on. That means they’re ill-prepared for a financial shock and are at risk of needing to borrow to meet bills and others expenses. Borrowing can be part of a healthy household financial plan, but it needs to be sustainable. It becomes risky when you’re borrowing to finance day to day expenditure. It is a really good idea to keep at least three months’ worth of essential spending requirements in the bank to provide a buffer against a financial setback.

“There may be a silver lining to all this, however. Research conducted by Quilter* at the end of April shows that the coronavirus crisis could encourage people to become more generous, with more than half of UK adults feeling motivated to support friends and family financially. One in five (20%) said they had been prompted to help others with short term financial matters like paying a bill or covering a one-off cost, and 17% said they’d been encouraged to think about how they could help relatives enjoy a more prosperous future through things like inheritance or gifting money. Combined with the 15% that said they were supporting friends and family before the crisis, it means that over 50% of us could now be looking to help others with money.”

 

*Survey conducted by Toluna on behalf of Quilter between 27-30 April 2020 with 1014 UK adults

For more information contact

Michael Glenister020 7778 963807469 144535michael.glenister@quilterinvestors.com

Notes to Editors:

About Quilter plc:

Quilter plc is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Quilter plc oversees £95.3 billion in customer investments (as at 31 March 2020).

It has an adviser and customer offering spanning: financial advice; investment platforms; multi-asset investment solutions; and discretionary fund management.

The business is comprised of two segments: Advice and Wealth Management and Wealth Platforms.

Advice and Wealth Management encompasses the financial advice business, Quilter Financial Planning; the discretionary fund management business, Quilter Cheviot; and Quilter Investors, the Multi-asset investment solutions business.

Wealth Platforms includes Old Mutual Wealth UK platform and Quilter International, including AAM Advisory in Singapore.

The Old Mutual Wealth Heritage life assurance business was acquired by ReAssure Group Plc on 2 January 2020.

Since its IPO in June 2018, Quilter plc’s businesses have progressively rebranded to Quilter, as follows: 

  • Quilter Financial Planning (previously Intrinsic)
  • Quilter Private Client Advisers (previously Old Mutual Wealth Private Client Advisers)
  • Quilter Financial Advisers (previously Charles Derby Group)
  • Quilter Financial Adviser School
  • Quilter Cheviot
  • Quilter Investors
  • Old Mutual Wealth (becoming Quilter Investment Platform)
  • Quilter International (previously Old Mutual International)

This press release is for journalists only and should not be relied upon by financial advisers or customers.

Please remember that past performance is not a guide to future performance. The value of investments and the income from them can go down as well as up and investors may not get back any of the amount originally invested. Exchange rate changes may cause the value of overseas investments to rise or fall.

This communication is issued by Quilter plc.  Registered office: Millennium Bridge House, 2 Lambeth Hill, London EC4V 4AJ, United Kingdom. Registered number: 6404270.  Registered in England.