Savings Balances are Not Directly Linked to Quality of Life in Britain

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This review of the savings market examines the relationship between customer savings and the annual Halifax Quality of Life Survey, which tracks where living standards are highest in Great Britain by ranking local performance across key indicators, covering the labour market, the housing market, the environment, education and health.

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Majority of the top 50 areas with the highest savings balances and the top 50 areas for quality of life are dominated by locations in southern England

Whilst residents of many areas with a high quality of life also have a high savings account balance, new research from Halifax proves that this is not always the case.

Residents of Kensington and Chelsea have the highest average savings balance1 of £10,185 in the country, but the Royal Borough is well outside the top 50 best areas for quality of life, currently ranking 80th.

Seven other areas in Britain’s top 20 for the highest savings balances also rank outside the top 50 areas with the best quality of life, including Christchurch (110) , Shetland Islands (207), Derbyshire Dales (133), Cambridge (172) and the London boroughs of Harrow (97), Barnet (150) and Westminster (168). (Table 1)

North South divide
Majority of the top 50 areas with the highest savings balances and the top 50 areas for quality of life are dominated by locations in southern England

However, none of the 11 areas in northern Britain that feature in the top 50 for savings balances appear in the top 50 for quality of life. These areas include Shetland Islands (207), Aberdeenshire (178), East Dunbartonshire (208) in Scotland and Hambleton (78), Ryedale (83) and Harrogate (127) in Yorkshire and the Humber.

Biggest savers with a high quality of life
There are some areas where residents rank highly in terms of both savings account balances and quality of life. Nine of the 20 areas with the highest savings balances in the country are also amongst the 20 areas with the highest quality of life.

Elmbridge has the eighth highest average savings balance in Britain (£9,262) and is the top-ranking area for quality of life. Residents of this Surrey local authority district tend to be in good health with a high average life expectancy; both the employment rate and income are above the national average, boosting the ability to save.

Residents of Mole Valley (£9,806), Chiltern (£9,486), St Albans (£9,017) and Windsor and Maidenhead (£8,939) are all in the top ten regions for savings balances as well as the top 20 in terms of quality of life. These areas score highly on earnings and employment rates. Their residents typically also have larger-than-average houses, are in good health and their children achieve high GCSE results.

Lowest savers
Few areas in the 50 with the lowest average savings balances appear in the top ranked areas in terms of quality of life. Again, there are exceptions. North Wiltshire (£6,013), South Gloucestershire (£5,956), Bracknell Forest (£5,890) and Ashford (£5,694) are all in the top 50 areas for quality of life.

Nitesh Patel, economist at Halifax, commented:
"It is in many ways encouraging to see that there is not a direct correlation between the quality of life ranking and the level of savings balances, with keen savers showing it is important to build a healthy savings pot regardless of location"
"Eight of the local areas in the UK's top 20 with the highest savings balances rank outside the top 50 areas with the best quality of life. Most notably, the area with the nation's highest savers – Kensington and Chelsea – is well outside the top 50 in terms of quality of life.”

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Nicholas Osbourne
Halifax
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