Craig Baker

A fear of losing money was the top reason Brits did not invest their savings, with a third (32%) of those who currently do not invest saying this concern put them off. A need to access money easily was the second most common reason (21%), with a similar proportion claiming that investing was too complex for them (20%).

The startling figures reveal a distinct lack of trust and confidence among the majority of Britons today when it comes to investing, despite rock-bottom interest rates meaning people receive almost zero growth on cash savings while inflation eats away at their pot’s value in real terms.

While just under half (43%) of people would invest if they had more money available, the analysis found more than a third (36%) of Brits say nothing would make them more likely to invest their cash, despite the chance to boost their savings.

More than half of Brits (56%) do not invest their savings, despite evidence demonstrating long-term investing can reap rewards. A sum of £1,000 invested in global stock markets 20 years ago would now be worth £2,988, an increase of nearly 200% according to Alliance Trust analysis, while the same amount held in cash would now be worth only £1,589 – a rise of just 58.9%.

Over just five years £1,000 invested in global stocks would now be worth £1,764, but if it had been left in cash would have only risen to £1,021.

Craig Baker, head of Alliance Trust’s investment committee, said: “With interest rates at historic lows, cash savings will likely result in a real-term loss over the years and it is important people look at the longer-term opportunity to invest their savings, particularly when it comes to saving for retirement or saving for children when most people can afford to leave their savings to grow over a prolonged period of time.

“There is a deep mistrust of markets and the world of investing, and it is vital the industry works to make itself more accessible, and easier to understand so that savers can reap the rewards of investing over the long-term.”