Understanding how much of your income you should be saving is an important part of taking control of your finances.
Once you build a good saving habit, you will find it much easier to achieve your broader financial goals like saving up for a house deposit, a wedding, or buying your dream car.
Knowing how much you should be saving is a key part of taking control of your personal finances. Whether you’re working toward buying a home, planning a wedding, or preparing for the unexpected, building a consistent savings habit can help you reach your goals.
How Much Are People Saving in the UK?
According to the Building Societies Association (October 2024), the median savings in the UK is around £9,000, with a mean average of £16,232. However, averages vary by age, income, and life stage. Generally, older individuals have had more time to build their savings.
If you’re curious about how your finances compare, our average savings by age guide offers a helpful benchmark.
| Age | Average Savings |
|---|---|
| 18 to 24 | £8,336 |
| 25 to 34 | £16,851 |
| 35 to 44 | £13,095 |
| 45 to 54 | £13,981 |
| 55 to 64 | £19,740 |
| 64 to 75 | £20,936 |
| 75 and over | £23,027 |
How Much Should You Save?
There’s no exact figure everyone should aim for. Personal finance expert Craig Rickman explains that your savings should align with your specific goals and timeline. For example, if you’re 25 and want to buy a house by 35, focus on saving a deposit over the next decade.
Sarah Coles from Hargreaves Lansdown recommends starting with an emergency fund. Ideally, you should have three to six months’ worth of essential expenses in an easy-access account. This amount can vary depending on your lifestyle, dependents, income stability, and health.
Emergency Fund: Why It Matters
An emergency fund acts as a financial buffer in case of job loss, medical emergencies, or urgent repairs. Based on average monthly essential outgoings of £2,058, a recommended emergency fund is about £6,174. However, your personal needs may require more or less.
Growing Your Savings: Use an ISA
One of the best ways to grow your savings is through an Individual Savings Account (ISA). You can save up to £20,000 per tax year tax-free. Popular types of ISAs include:
- Cash ISAs (low risk)
- Stocks and Shares ISAs (higher return potential)
- Lifetime ISAs
- Junior ISAs
Despite their benefits, many people overlook ISAs. According to NatWest, 22% of 18–24-year-olds don’t know ISAs exist, and 62% of people have no plans to open one in 2025. Don’t miss out on tax-free savings growth.
Saving vs Investing: When to Start?
Saving is great for short-term needs, while investing helps grow long-term wealth. Before investing, clear high-interest debts and build an emergency fund. Rickman recommends investing only if you can commit for at least five years to ride out market fluctuations.
Age-Based Savings Benchmarks
By age 30, most people start saving for big life events. The average age for first-time homebuyers is 33, and the average savings for people aged 35–44 is £13,095.
At age 50, higher income and dual-income households often lead to more savings. The average savings for those aged 55–64 is £19,740, according to the latest data.
Final Thoughts
There’s no magic number when it comes to how much you should save. Start with what you can, build an emergency fund, and take advantage of ISAs to grow your money tax-free. Align your savings with your goals, and remember—even small steps now can lead to big financial wins later.
