Savings caution increases

By Sarah Engle, Mon 28 Apr 2008 - Published in Banking

People are now being more cautious about where they choose to invest their money and savings, a new survey has suggested.

Research undertaken on behalf of Newcastle Building Society has found that there has been an increase in the number of people that would rather keep their cash at home, as they trust in financial systems has been weakened because of the credit crunch.

The survey found that some 11 per cent of respondents believe the safest place for their money is under the mattress at home, up from four per cent one year ago.

Other results showed that confidence in banks and building societies had waned, with fewer consumers willing to invest their savings in such institutions.

"These findings are a stark sign of the times, but they are also exacerbated by the hyped surrounding the credit crunch," said Wendy Lee, commercial director at Newcastle Building Society.

Earlier this month, the building society suggested that due to the tough conditions in the money markets, financial services providers are having to rethink their strategies in order to tackle economic problems.

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