In depth: Scots facing a tug of war between family priorities and investment plans

Fidelity International, which specialises in investment and retirement, is reiterating the importance of regularly putting something in the piggy bank where possible, but it has also revealed new data shining a spotlight on how Scots’ own saving plans are being hampered, with women in particular continuing to shoulder additional financial stresses overall.

According to figures that form part of its Women and Money campaign, the firm has found that in Scotland, 47 per cent of men and 45 per cent of women with more than £1,000 in assets say providing financial support for a loved one presents a barrier to either investing in the first place, or adding more money to their investments now. The figure rises to nearly two-thirds of females in their 20s and 30s at a UK level.

For adults in Scotland, their competing financial goals include saving for their own retirement (30 per cent) and getting onto the property ladder (9 per cent), Fidelity’s data also shows.

Furthermore, looking at the picture in Scotland 10 per cent of women and 7 per cent of men in say providing financial support for loved ones is a major blocker to their investment plans, and Scots’ competing financial goals include saving for their own retirement (30 per cent) and getting onto the property ladder (9 per cent).

The firm said last month that 66 per cent of people north of the Border with £1,000 in assets say the rising cost of rent and mortgages is a barrier to their plans when it comes to investing, amid interest rates remaining at 5.25 per cent. Fidelity also revealed that the problem was found to be more acute for women, at 68 per cent, compared to 64 per cent of men. And a separate study also revealed in September said more and more Scots were becoming homeless due to racking up rent arrears or defaulting on their mortgage.

The financial services firm now says 11 per cent of adults in Scotland (14 per cent at a UK-wide level) are also saving to support their parents in old age, and nearly a quarter are less confident about saving for retirement than they were five years ago (21 per cent of UK women), with “competing financial priorities likely to be a strain on their financial planning”. Meeting the current cost-of-living pressures is a top concern for 26 per cent of Scots polled.

Emma-Lou Montgomery, associate director of personal investing at Fidelity, says: “Life throws up different challenges at different stages, which has an impact on our finances and what we are saving for. For some, the current balancing act might be focused on keeping up with the cost of living and moving towards homeownership or starting families. After all, those in their 20s and 30s could have more pressing demands on their money than a far-off event like retirement some 40-plus years down the line.

"The reality isn’t always simple, though. Swift action and saving as soon as you start working can make a huge difference to the end result. And sooner than many think, responsibilities for others become part of that thinking. It was interesting to see how many women in their 20s and 30s provide retirement support to others already. Indeed, care responsibilities for others add another layer to consider as both costs and time need to be weighed up against job commitments and adequate provision. While the exact cost calculation for long-term care is uncertain, this is where regular contribution investment is needed early on.”

She does however not Scots as unwilling to grow a savings pot, and says: “While almost half of men and women in Scotland struggle or are unable to pursue their investments in the current high-cost environment, that doesn’t mean the appetite isn’t there.”

It also seems that the Scottish phrase “many a mickle makes a muckle” – many small things create something big – holds very true in this regard. “Sometimes it’s about setting small, achievable goals that can start a saving or investing habit. Doing this plays a significant part in safeguarding your future financial security – and these needn’t be large amounts,” Montgomery stresses. “Knowledge is power – and making sure you have a clear understanding of all aspects of your financial position – from your income to outgoings – will ensure you’re able to prioritise and make informed decisions that support your goals realistically.”

Fidelity also says its own data analysis from its “power of small amounts” calculator shows that if women aged 25 earning an average salary (£24,188) increased their workplace pension contributions by just 1 per cent – equivalent to under £5 a week – they could have an additional £62,200 by the time they reach retirement at 68.

And personal investing expert Montgomery also touches on the remaining financial gender disparity. “While both young men and women shoulder the responsibility of supporting loved ones financially, the financial playing field is far from level. Women in their 20s and 30s, who are just setting out on their own financial journey, often face additional challenges when managing their money.

"From the gender pay gap, through to balancing potential career breaks to care for children or loved ones, all of this adds to women’s already-squeezed finances. Providing financial support for loved ones is another challenge to add into the mix. But it’s important that women, especially those in this age group, don’t lose sight of their own futures.”