The rising cost of living in the UK has prompted many households to tighten their budgets significantly, with the typical Brit saving an impressive £1,411 this year. A recent survey of 2,000 adults revealed that 83% of respondents have reduced their discretionary spending, focusing primarily on essential expenses as inflation continues to strain finances.
According to the survey, individuals have made substantial cutbacks in areas such as holidays and social outings, resulting in average monthly savings of £117.60. Many families have opted for more affordable supermarkets, reduced or canceled TV subscriptions, and curtailed their clothing purchases to manage their budgets effectively.
Shifts in Spending Habits
In a bid to supplement their income, various strategies have emerged among consumers. Approximately 35% of those surveyed reported selling old clothing, while 28% have begun investing their savings, and 21% have started side hustles. Notably, almost half of respondents, 45%, plan to set aside their savings to cope with ongoing rising costs. Meanwhile, 29% intend to use their savings for essential expenses.
The survey also highlights a concerning outlook for many Brits. While 64% attribute their spending cuts to rising costs, 20% express worries about impending tax hikes. Furthermore, 38% fear they will find themselves in a worse financial situation following the government’s upcoming budget announcement. A significant number, over a third, are anxious about their ability to afford Christmas this year.
Consumer Sentiments and Market Responses
The research was commissioned by electric car manufacturer Leapmotor, following the launch of its latest SUV, the B10. Priced at £29,995, the B10 is marketed as one of the most affordable mid-sized SUVs available, providing a budget-friendly alternative to models like the Kia Sportage.
Damien Dally, UK managing director of Leapmotor, emphasized the challenges many consumers face when purchasing a vehicle. “A car is a necessary purchase for many, but we appreciate it’s not a small financial outlay,” he stated. He expressed concern that potential new taxes on electric vehicles could deter consumers from switching to greener options.
Recent discussions regarding a pay-per-mile tax for electric vehicle owners have reportedly dissuaded 28% of the population from considering electric cars. However, if the overall cost of ownership, including charging, were cheaper than their current vehicles, 45% stated they would reconsider.
Dally added, “Money is tight for many, and speculation surrounding the Budget adds to the anxiety. Brits are cutting back on luxuries and saving for essentials.” He encourages consumers to seek out affordable options without sacrificing quality, enabling them to allocate more of their budgets to meaningful experiences with friends and family.
The results of this survey reflect a broader trend among consumers facing financial pressures. The commitment to saving and adapting spending habits underscores the ongoing impact of the cost-of-living crisis in the UK, with many prioritizing financial security in uncertain times.
