Rising Cost of Living Puts Pressure on British Families, Reveals Study

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A recent study conducted by Skipton Financial Services has unveiled the shocking reality that the average British family must bring home an astounding £24,600 per year just to make ends meet. The comprehensive analysis took into account various essential expenses, such as mortgage or rent payments, utilities, insurance, food shopping, and transportation costs, including commuting to work and maintaining a property.

Surprisingly, this staggering amount does not encompass any luxury expenditures, such as takeaways, dining out, social outings, weekend getaways, or vacations. Inflation, currently surpassing the target rate at 5 percent, continues to exacerbate the financial strain on families, particularly with the skyrocketing prices of food, petrol, and energy bills.

Andrew Barker, the managing director of Skipton Financial Services, expressed his concern over the cumulative impact of these costs, stating, “It’s frightening how everything adds up. The cost of living is astronomical, and now more than ever, people have to be vigilant about their spending habits, especially given the high inflation rates.”

The study, which examined the expenditure patterns of 2,000 households with at least two children, highlighted that mortgage repayments represent the most substantial burden for parents, averaging £4,730 annually. Weekly grocery bills closely followed, averaging £86 per week or £4,457 over the course of a year. Petrol expenses amounted to £47 per week or £2,452 annually, while commuting to work added an additional strain of £2,445 on family finances. Repaying credit card bills and loans accounted for another £3,131 each year.

The study further revealed that utility bills amounted to £1,282, and even subscriptions for satellite or cable television services reached £476. Council tax contributed £1,217, while car insurance and vehicle taxes accounted for £896. Mobile phone bills alone came to £368.

Startlingly, the survey found that four out of ten respondents tend to spend most of their income on personal desires rather than saving for the future. Only slightly over 40 percent admitted to having a savings account, with an average monthly contribution of £86. However, a quarter of participants disclosed that they were saving less than they were a year ago, with a decrease of £54 per month.

Additionally, the study highlighted that three-quarters of women compared to six in ten men assumed responsibility for managing the household finances. Two-thirds of respondents agreed that women were better suited to handling money matters.

Andrew Barker emphasized, “Our research indicates that households actually need to earn £24,600 to break even. However, considering income tax and national insurance deductions, a basic rate taxpayer would have to earn £32,702 to bring home this figure.” Barker further advised individuals to review their bank statements, scrutinizing all direct debits and standing orders to gain a clear understanding of their financial outflow. This process could also unveil unnecessary expenses, such as redundant magazine subscriptions or gym memberships.

To alleviate financial pressure and manage budgets effectively, Barker recommended developing a monthly budget plan that includes all expenditures, even those irregular ones associated with holidays or Christmas. For annual events, he suggested dividing the cost by 12. Furthermore, Barker stressed the importance of maximizing the growth of any saved or invested funds and advised consulting with a financial adviser to assess the performance of existing investments.

As the cost of living continues to rise, families across the country are faced with the challenge of balancing their budgets and finding ways to make their income stretch further. With careful financial planning and a keen eye for unnecessary expenses, households can navigate these trying times and safeguard their financial well-being.

Elliot Preece
Elliot Preecehttps://newswriteups.com/
Founder | Editor Elliot is an experienced journalist manager with a passion for writing. He played a pivotal role in building the News Write Ups website as a web developer and has since been leading the team of journalists to produce high-quality content. With his strong background in writing and web development, Elliot ensures that the website not only functions smoothly but also provides engaging and informative articles for readers. elliot@newswriteups.com

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