Almost one third of the UK population, equating to 15 million people, is not managing to put away anything in savings, a report has warned.
The tough economy and the need to help other family members struggling with high living costs means that many people are living on a "financial precipice", with little or nothing to fall back on, Scottish Widows said.
Some 31% of people said that they are not currently placing any cash aside, although this is a marginal improvement compared with a year ago when 32% of consumers said this. However, only one in nine (11%) of those surveyed expects the economy to pick up this year and 17% have no money to fall back on at all, the Savings and Investment report said.
Of the two-thirds of people who are managing to add to their nest eggs, 32% have a total pot of less than £1,000 - which would not even be enough to pay someone's average mortgage and council tax costs for a month - the report said.
One quarter of people surveyed who have families said they had handed out loans to their children, which were often just to help them cope with high living costs as wages stagnate.
Parents said that they had given out loans averaging £15,000 to help their children take major steps such as getting on the property ladder or going to university, showing an 11% year-on-year increase in terms of the average loan size. Some 24% of parents said this support had forced them to cut back on their own savings and one in 12 had stopped saving altogether.
Older generations are also feeling the strain, with grandparents saying they have lent £3,665 on average to their grandchildren.
Two-thirds of people across the survey said that a general lack of any spare cash is holding back their ability to save.
As well as rising living costs such as food, energy bills, rents and petrol making life harder for savers, rates on savings accounts have been plummeting in recent months, meaning they face an even tougher struggle to make any real returns. A Government scheme launched in August has given lenders access to cheap finance to help borrowers. But analysts have said this scheme has made lenders less reliant on the need to attract savers' deposits, meaning that savings rates have plummeted.
The choice of tax-free Isas on the market has shrunk by a fifth compared with February 2012, recent research by financial information website Moneyfacts has found. The Isa deals on offer this year are also less likely to allow people to transfer savings in from older Isas than those on the market in spring 2012, the website said. High street banks have also reported a trend towards people using any extra money to pay down their debts as consumers continue to act cautiously in the difficult economy.