New analysis has shown a third of households in Scotland (32%) report having nothing in savings.
This proportion was much higher than the rest of the UK, which stood at less than a quarter (23%), according to the analysis carried out by researchers at the University of Bristol.
The gap between Scotland and the rest of the UK also appears to be widening. In 2023, 29% of households in Scotland had no savings, whilst the figure for the rest of the UK was 26%, meaning the proportion without savings in Scotland has increased but the rest of the UK has gone in a more positive direction.
The Financial Fairness Tracker, commissioned by the abrdn Financial Fairness Trust, has been monitoring the personal finances of around 6,000 UK households since the start of the pandemic.
One-in-seven (14%) of the 880 surveyed households in Scotland are 'very worried' about their overall financial situation in the next 12 months. One-in-five households in Scotland (20%) meanwhile felt they were 'currently struggling to pay for food or other necessary expenses' to some extent. A similar number of households (22%) said they would need to borrow to meet their expenses if their household income fell by a third or more, compared to 18% of households in the rest of the UK.
Financial difficulties are also taking a toll on households' health and wellbeing. More than a third (36%) of Scottish households feel they have no control over their financial situation, while a similar proportion (35%) say financial worries cause them to sleep poorly at night or their financial situation is causing their mental health to deteriorate (37%).
More positively, financial confidence is substantially higher now than in 2022. Back then two-in-five households (39%) lacked confidence in their overall financial position for the next three months whereas this has now halved to one-in-five (20%).
Professor Sharon Collard, Chair in Personal Finance at the University of Bristol, said: "As the Scottish and UK Governments continue to grapple with the issue of low productivity, this new data is a stark reminder that, for many households in Scotland, money worries are strongly linked to poor health and wellbeing. These need to be tackled in tandem if we are to see productivity growth."
Mubin Haq, Chief Executive Offider of abrdn Financial Fairness Trust, said: "It's vital we all have a financial cushion to help us cope with financial shocks, such as replacing essential household goods or losing a job. Without any savings, everyday problems such as the fridge breaking down can push people into debt and force them to turn to high-cost lenders. What is particularly worrying is that Scotland is moving in the wrong direction with even fewer having a savings safety net, which is in stark contrast to the rest of the UK."
