8.8m would not last a week on savings
The survey of over 1,000 UK households found that a quarter (25%) have no savings at all to fall back on, up from 19% in 2012, while one in ten have £250 or less.
Based on average monthly outgoings of £1,500 they would only last five days before running out of funds.
The number of households in this situation has risen by almost 800,000 since October 2012 when just over 8 million had £250 or less in their savings pots.
The 18-24 age group are the worst off in terms of savings, with a third having nothing to fall back on and 6% having less than £250 in their nest eggs. However 35-44s are not far behind, with 33% having nothing in savings and 12% having less than £250. As this age group has greater financial responsibilities (with daily outgoings 54% higher than 18-24s) they would struggle, lasting just five days on savings of £250 compared to seven for 18-24s.
Almost a third (31%) said they would not be able to pay their bills or mortgage/rent if they were unexpectedly to lose their income, up from 28% in October 2012, while 36% would be dependent on their savings.
Oliver Cook, head of savings at HSBC, said: “The findings indicate that the proportion of Brits who are financially unprepared should they face any unexpected expenses or loss of income has risen steadily over the past year, with an extra 800,000 households admitting to savings of £250 or less.
“Getting into the habit of saving and making regular savings, no matter how small, can help to build up a financial safety net that avoids having to resort to methods that add to debt. As a target, it’s important to keep in mind that as a general rule, a minimum of three months’ salary should be available for a rainy day.”