Seven in 10 savers (68%) in the UK feel more confident about their personal finances today than six months ago as disposable incomes have increased, according to new Paragon Bank research.

The firm’s survey of over 1,500 active savers showed that 22% of savers said they they felt “very confident”, while just 7% said they felt less confident now than they did in January.

Paragon found that that 23% of savers saw their disposable income increase during the second quarter of the year compared to the first, although 17% did see their disposable income fall. The remaining 60% experienced no change in their disposable income.

Managing director of savings at Paragon, Derek Sprawling, said: “As the rate of inflation reduced, savers are reporting that they are feeling more confident about their financial position. After the economic volatility of recent years, that is much welcomed, particularly for retirees who are generally on fixed incomes and have seen their returns eaten away by high inflation.”

Savers in retirement age were more likely to report improved disposable income, compared to those of working age. On average, the study showed that 25% of those aged 65 or over reported improved disposable income, compared to 19% of those aged from 35 to 65. The highest percentage, 39%, was reported by those between the ages of 18 and 24 – suggesting they had moved up the jobs ladder.

Retirees were also more likely to report lower levels of decreasing income. On average, 15% of over-65s said their disposable income deteriorated during the quarter, compared to 23% in the 35 to 65 age group.

Sprawling added: “Despite the generally more confident outlook, savers are still being savvy with their finances, with nearly one in five reducing spending. As well as keeping an eye on outgoings, I would urge savers to ensure they are reviewing the rates of interest they are earning and ensure they are keeping their cash in competitive accounts to maximise their returns.”

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