· Three quarters have cut back their spending on luxury items or necessities
Parenting on Female First
· 71 per cent now opt for supermarket ‘own brand’ foods instead of branded goods
· Over half have turned off their heating even when it’s cold
· One in ten are skipping meals to feed their family
With Chancellor George Osborne revealing the changes he’ll be making to the nation’s finances in the Budget yesterday, MoneySupermarket reveals the findings from its own ‘Real Budget Report’ - highlighting the tough measures being taken by households across the country as a result of rising cost of living and austerity measures.
The ‘Real Budget Report’ looked at household adjustments that have been made in the past year, as well as plans for household spending over the next 12 months, as families across the nation seek to make their own ends meet.
Three quarters of consumers say they have limited their household spending in the past 12 months, with more than a third cutting back spending on necessities in the last 12 months and two thirds cutting back spending on luxury purchases.
More than one in ten people who have made cut backs to necessities have skipped meals to make sure their kids are fed, and nearly one in five have not paid energy or credit card bills in an attempt to cut back on household spending.
The ‘Real Budget Report’ also highlights other changes being made by those who have been forced to cut back, including 30 per cent have reducing the amount they’ve been able to save (e.g. into a savings account or a pension); 45 per cent cutting money-off coupons out of newspapers / magazines / online; 43 per cent saying they’re now turning to price comparison sites to shop around for the best deals; and 22 per cent doing their own DIY instead of hiring professionals.
Clare Francis, Editor-in-chief at MoneySupermarket, said: “Household finances are taking a battering from all sides at the moment. Average incomes have fallen in real terms over the past four years, the cost of heating our homes continues to rise and food prices and motoring costs are also taking their toll on family budgets.
“As a result, it is not only the Chancellor who has a fight on his hands to keep the nation’s head above the water - households are having to do likewise and some are making drastic cuts just to get by.”
Luxury spending has also been reigned in, with 70 per cent of those who have cut back on luxury purchases saying they’ve cut back on eating out or ordering takeaways, while 60 per cent have cut back on days / nights out, and 59 per cent have dropped treats for themselves.
Nearly half have cut back on holidays, and 17 per cent have cancelled a membership subscription such as the gym.
In a bid to increase their household income, 29 per cent have sold items on ebay or at a car boot sale, while over a fifth have resorted to taking money out of their savings, and 16 per cent have started doing overtime at work.
Additionally, a third of people are concerned about their finances, and don’t see things getting better any time soon. A further 16 per cent are concerned they won’t be able to meet their bill repayments, and 12 per cent worry they won’t be able to provide for their family.
Household ‘austerity measures’ look set to continue for the remainder of 2013, with nearly three quarters of people still planning to cut back in some way over the next 12 months.
Clare added: “In order to free up some vital cash, UK households need to take control of their finances, become their own chancellor and review all of their financial products to make sure they are benefiting from the most competitive deals on the market.
“Switching to economy brand food may help save the pennies but failing to pay important bills could have a bigger impact on your financial situation in the long term so it’s time to tackle them and make sure you’re not paying more than you need to.
“Apathy is rarely rewarded and switching from average deals to the market leading option on a range of financial products could save you hundreds of pounds.”