We spend longer each day on making a cup of tea than we do pausing to look at our finances, according to new research from Skipton Building Society which interviewed 2,000 UK adults about their financial habits.
Around three in five (57 per cent) spend half an hour a week or less (29 minutes) looking at their finances. This equates to less than 4 minutes a day, about the same as brushing your teeth or making a cup of tea.
The research highlights that we’re not just failing to look at our personal finances, but that few people are taking action. Just one in five (22 per cent) say they take the time to actively manage their money each week, be that working out budgets, paying bills, looking at their internet banking, setting up new savings or investment products or visiting a branch.
Londoners spend the longest managing their finances each week (2.52 hours), well above the national average (1.9 hours).
What are we spending our time doing instead?
More than half of those surveyed (56 per cent) say they don’t tend to prioritise their finances at all and two in five (42 per cent) say this is because they have other more important things going on in their lives. When asked why they don’t prioritise their finances, one quarter (23 per cent) say they find it too boring and one in six (16 per cent) blame a lack of time for the reason they can’t pause to do this.
Those aged 25-34 were the most likely to make time for their finances, with over half (51 per cent) doing so compared to 40 per cent of over 55s.
The perfect financial pause
Skipton’s data also explores how the amount of time people spend on actively managing their finances impacts how they feel – to identify the optimal time for a ‘financial pause’ that can lead to better financial health.
The data reveals that the people most likely to feel positive about their finances are the ones who are getting under the skin of their money regularly: doing so on average 2.7 times each week, for an average of 40 minutes each time.
Those who feel most negatively are spending longer on their finances each week (174 minutes), and typically spend on average one hour each time. Just one in five of those surveyed (20 per cent) think that their finances are in a good state, with the research highlighting that many of us fail to find the time to pause and focus.
Dr Richard Wiseman, psychologist and author at the University of Hertfordshire, says, ‘The human attention span tends to be at its best for a maximum of 40 minutes at a time and after this point, our attention usually starts to wane. This new research from Skipton demonstrates just how difficult we tend to find long-term thinking. This is because short-term options usually give a quick emotional win, whereas longer term options, such as planning for retirement require more logical thinking, which we can find more difficult to process.
‘By actively trying not to think about something, we often end up thinking about it more. Skipton’s research shows that we last thought about our plans for retirement 56 days ago so when it comes to finances and in particular looking at retirement, it would be far less stressful for people to think about it in the present, than avoiding it and spiralling into problems further down the road.’
Jacqui Bateson, senior propositions manager at Skipton Building Society says, ‘Looking at life ahead, it is sometimes hard to see beyond your next cup of tea or weekly shop. Unfortunately our research shows that we are simply not pausing to think about our finances enough.
‘It’s understandable that we have other priorities in our lives but pausing to think now about how you will manage in later life will only benefit you in the long run. This could mean having enough money set-aside for that holiday you’ve always dreamed of or simply having enough savings to enjoy a comfortable retirement, but either way, stopping to think now will help facilitate these goals and make you feel better and more positive.
‘At Skipton, it is our priority to guide people to think about their options for their financial future. Whether it is saving through a pension, an ISA or other means – we want to be there every step of the way.’
Top tips from Skipton: The way to a perfect financial pause
Find a time that works for you
Only a quarter of people (26 per cent) say they set aside specific time to consider their finances, so try planning a pause in the same way you would arrange a meeting or social event. Allocate time on Sunday evening to plan your budget for the week ahead or pop into a branch on your lunch break. This will help you to feel more confident about achieving your goals.
It’s good to talk
Talk to friends and family members to understand how they might approach a particular financial situation. If you’d prefer to keep things private, do your research by checking newspapers or listening to related podcasts instead. Don’t be afraid to seek expert advice in confidence; even if it feels awkward.
Set yourself goals for the short, medium and long term and review your goals on a regular basis. Keep on top of your short term goals by checking progress every week, or month. For longer term goals, once a year should be enough to make sure you continue achieving your ambitions.
Treat the long term the way you treat the short term
Data shows that the majority of people in the UK have not thought about their retirement plans for 56 days on average, but they have paused to check their internet banking (six days), pay bills (ten days) and check on their savings (15 days ago). Although retirement may seem more distant for some, a little pause today, could have a big effect tomorrow.
A little action is better than none at all
Although finance can sometimes seem like an impossible task, the smallest steps are better than nothing. Read the personal finance pages or try some online research about different savings products to identify the ones that could be right for you.