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Financial confidence shows steep rise

Thursday, January 24 11:29:22

Last month saw the biggest rise in consumers' financial confidence in five years, Standard Life's latest Financial Confidence Index survey shows.

The index increased from 50.6 to 55, hitting the highest level reached since December 2009. It hit an all-time high of 66.7 in March 2008 and an all-time low of 50.6 in December, 2011.

"This is the biggest increase we've seen since its launch in June, 2007," said Brendan Barr, head of marketing, Standard Life. "Hopefully this is the consumer confidence turnaround we've been waiting for. The index has been relatively stable at around 50 for the last two years, so hitting 55 is significant. There were no real surprises in the Budget and anecdotally people seem to be more optimistic about the outlook for 2013," he said.

Overall financial confidence has increased for all groups compared to one year ago.

Those aged 55 to 64 showed the largest increase in financial confidence levels increasing by 11 points to 63.8, followed by 25 to 34 year olds whose confidence levels improved by 6 points to 55. Retired people are the most confident respondents scoring an impressive 66.7 compared to the average score of 55.

The only age group whose confidence levels decreased were 45-54 year olds, down one point to 48.

Men and women have experienced relatively large increases in confidence. The gap between men and women's confidence has widened, compared to the previous quarter. Men are typically more optimistic in these surveys but the quarterly difference is relatively high at over 7 points.