PEOPLE ARE PUTTING their pennies cents aside, according to the most recent savings index released today.

The Nationwide UK (Ireland)/ESRI Savings Index shows that 37 per cent of people are now saving regularly.

The Savings Index is constructed from monthly research on the attitudes of Irish consumers towards spending.

The above diagram shows that the savings Index has increased in the past year.  There’s been an increase in January to 97, from 88 in December.

Savings Attitude sub-index

Meanwhile, the savings attitude sub-index asks people how they feel about the amount they are saving.

This month, the sub-index increased to 111, a 10-point jump on last month and 17 points ahead of January 2013.

In January, 37 per cent of people are saving regularly, an increase from 34 per cent last month and 29 per cent a year ago.

Savings Environment sub-index

The savings environment sub-index asks if people think now is a good time to save. It showed an increase in the number of people who think it is.

Twenty nine per cent of people think now’s the time to squirrel away some cash, compared to 24 per cent in December and 23 per cent last year.

And the numbers of those who believe saving isn’t a good idea are going down.

Fifty four per cent per of people thought it was a bad idea last year in January 2013, that decreased to 50 per cent last month but it now stands at just 36 per cent .

This sub-index increased to 82, an 8 point increase compared to last month.

So while saving seems increasingly popular, nearly two thirds of people believe that government policy discourages saving.

Only six per cent of respondents feel that government policy encourages saving.

This is the second lowest share recorded since the index began in 2010.

Good intentions?

When asked how about allocating money above everyday needs:

• 50 per cent said they would use surplus cash to pay off debts like mortgage;
• 30 per cent would save the money;
• 10 per cent would spend it;
• 10 per cent would invest it.

The Nationwide Savings Index is produced monthly from a minimum of 800 consumers.

Consumers ‘gradually recovering from the extreme difficulties’>

Open thread: how do you plan to save money?>