'Savings fall as consumers pay off debts'

The amount being deposited in savings by consumers, potentially including those saving for children, has fallen as people try to pay off debts, it has been suggested.

According to figures produced by Unbiased.co.uk, consumers paid off over £23 billion more in debt than they took out in new borrowing during the third quarter of this year.

However, saving levels fall by almost half during the period to £19.3 billion, compared to £38.5 billion in the previous quarter.

Commenting on the statistics, Unbiased.co.uk's chief executive David Elms said: "With such a focus on paying off debt, the UK savings levels felt the repercussions and dropped to an all time low."

He added that the decision as to whether to prioritise savings or service debts can be a "difficult one to make".

People bucking the trend and choosing to put money away may be interested in a new child savings account which has been opened by The Nottingham building society.

The investment product offers a gross interest rate of 7.5 per cent, which is fixed for a year.