15 September 2008
- A quarter of Brits rely on their bonuses for day to day spending whilst one in five use it to pay off debts
- Only one in ten now spend their bonus on luxury items
- Women are more careful spenders with their bonuses than men as over a third put their bonuses in a savings account
New research* from Kaupthing Edge, the leading online savings bank, shows that cash-strapped Brits are relying on their bonus payments to pay for day-to-day expenses. Of those who receive a cash bonus, 26 per cent leave the money sat in their current account for day-to-day spending and worryingly one in five (19 per cent) are relying on their bonus to pay off their debts.
Only a meagre one in ten (10 per cent) of Brits are now using their bonuses to treat themselves to a luxury item. This figure rises to 13 per cent amongst the 18 - 34 year olds who still fritter their bonus on a luxury shopping spree without delay.
When it comes to spending the annual bonus it seems women have a different attitude than men. 30 per cent of men leave their bonus in their current account for day-to-day spending compared with 20 per cent of women. Also, while 37 per cent of women put their bonus in a savings account, either to provide a safety net or to save for something special, only 25 per cent of men are saving their bonuses.
Where the UK is putting their bonuses
|
Total |
Men |
Women |
| Keep it in my current account for day to day spending |
26% |
30% |
20% |
| I put it into a savings account for something special (e.g. holiday or house) |
22% |
17% |
28% |
| I spend it paying off my debts |
19% |
21% |
16% |
| I spend it immediately on luxury items |
10% |
10% |
10% |
| I put it in a savings account to build up a safety net |
8% |
8% |
9% |
| I know how much to expect and use it as part of my wages |
7% |
7% |
7% |
| I rely on it to cover annual expenses (insurance, council tax etc) |
4% |
2% |
6% |
| Don’t know |
5% |
5% |
5% |
Ashley Whittaker, Head of Savings at Kaupthing Edge comments: "It's worrying to see just how many Brits now have to use their bonus payments to pay for their day to day spending."
"But with Brits being more and more financially stretched, it is important that people plan what to do with their bonus money carefully. If you can afford to save some or your entire bonus, you should make sure you are not just leaving it in your current account. By transferring the money into a high interest savings account, you will no doubt be getting better returns and you are also less likely to spend it on unnecessary purchases."
"Kaupthing Edge currently offers the best buy rate on the market at 6.55% AER** on its instant access savings account and what is more important – the rate is guaranteed to be at least 0.3% above base rate until 2012."
Notes to Editors:
*Research conducted by Opinium Research with an online poll of 2010 British adults from 11 to 15 July 2008. Results have been weighted to nationally representative criteria.
**AER stands for Annual Equivalent Rate and illustrates what the interest rate would be if interest was paid and compounded once each year.
Key product details:
- Instant Access Savings Account
- 6.55% AER (6.36% gross)
- Rate guaranteed to be at least 0.3% above base rate until 1st February 2012
- Min balance upon which interest is paid: £100
- Max balance: £2 million (across all accounts)
- No tie ins or charges
- 24-hour online access
- Fixed Term Deposit Accounts
- 6 month term account: 6.97% AER (6.85% gross)
- 12 month term account: 7.15% AER (7.15% gross)
- 36 month term account: 7.15% AER (7.67% gross)
- 24-hour online access
- Min balance upon which interest is paid: £1,000
-
- Kaupthing Edge is the online retail financial services offering of Kaupthing Bank and its UK subsidiary, Kaupthing Singer and Friedlander
- Kaupthing Edge's internet access savings account and fixed term deposit accounts are available at www.kaupthing-edge.co.uk. See account details below.
- Kaupthing Edge deposits are currently held by Kaupthing Singer and Friedlander Ltd and are protected under the UK Financial Services Compensation Scheme. Under the UK Financial Services Compensation Scheme, financial protection is limited to 100% of the first £35k of all deposits with KSF Ltd.
- Kaupthing Edge is a global brand operating in the UK, Isle of Man, Germany, Norway, Sweden, Finland, Denmark, Switzerland, Belgium and Luxembourg.
- Kaupthing Bank is Iceland's largest bank and offers comprehensive commercial and investment banking services to individuals, companies and institutional investors. Kaupthing Bank operates in thirteen countries with its headquarters located in Reykjavík, Iceland.
- Kaupthing Singer and Friedlander Ltd offers integrated financial services, including Corporate Banking, Investment Banking, Asset Management, Treasury, Asset Finance and comprehensive wealth management for Private Banking clients.
Registered Office:
One Hannover Street, London, W1S 1AX. Registered Number 875947. Registered in England. Authorised and regulated by the Financial Services Authority (FSA Registration Number 140839)
For further information, please contact:
Kaupthing Edge Savings Product: please contact Lansons Communications
Anna Schirmer: 0207 294 3605 or 07765567842
Jennifer Comerford 0207 294 3678 or 07977473045
For Kaupthing Bank – corporate: please contact Brunswick Communications
Anita Scott / Nigel Prideaux 00 44 207 404 5959