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Kevin Brown comments on inflation hitting a new 30-year high

Kevin Brown, savings specialist at Scottish Friendly, comments:

Britons' earnings are falling at their fastest rate for a decade due to the impact of inflation and the situation is likely going to get worse now that it has reached a new 30-year high of 7%.

Workers are completely helpless and can only sit and watch as inflation eats into their pay. Prices are rising month-on-month and with each new pay packet households are finding their money is diminishing in value at faster rates than we've seen for decades.

Autumn is likely to be the crunch point for a large number of families when energy prices spike even higher and we predict that inflation could potentially rise as high as 10%. As disposable incomes are squeezed ever tighter, more people will be contemplating how much they can afford to save.

Our latest analysis shows that household saving is forecast to drop to an average of £39 a week this year from an average of £89 in 2021. Inevitably, some households will be able to save far more than this while others will be powerless to save anything.

For those who do still have some wriggle room, we would encourage them to try and protect their regular savings and investment and look at ways of cutting out other non-essential costs.

An emergency or rainy-day fund could be vital to help families cope with any unexpected bills this year. However, anything on top of that, households should consider investing, as it is one of the few ways people can look to mitigate the effects of soaring inflation.

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