UK households 'getting richer'

UK households 'getting richer'

Most people prefer to keep their money in cash

People in the UK are getting richer in spite of the falls in the stock market, according to research by Halifax.

It says that continuing rises in house prices have countered the effect of tumbling shares.

Halifax estimates that, at the end of 2002, UK households had a total wealth of £4,252bn.

This represented a rise of £21bn, or 0.5%, during the course of the year - a rise due entirely to the increase in the property values.

Long-term for shares

With share prices swinging wildly it was perhaps no surprise that Halifax found people were increasingly pessimistic about the future course of the stock market.

Only 16% of adults thought the market would rise over the next few months compared with 45% expecting further falls.

But people were happier about the stock market as a longer-term investment.

Almost a fifth of the adult population said they would choose to invest £5,000 for 10 years in the stock market.

Cash is king

The survey also found that deposit accounts remained the favourite investment for the majority of adults despite the current low interest rates.

When asked where they would invest £5,000 for one year 68% said they would put it in a deposit account, 16% preferred investments linked to house price movements and 12% preferred stock market related investments.

Nearly a third of adults said they planned to increase their savings in the coming months but most said they would prefer to keep their money in cash rather than shares.