Connect with us

Hi, what are you looking for?

Business

U.K. economic woes see massive shift in the financial priorities of households

It’s important to try and be as prepared as possible, and realistic about your financial goals over the next year or two.

Image: © AFP/File LOUAI BESHARA
Image: © AFP/File LOUAI BESHARA

The U.K. economy is in a precarious position, due to both energy costs and the recent actions of the Truss government. With U.K. energy bills expected to skyrocket in October and with the cost-of-living increasing drastically across the UK, credit management company Lowell has surveyed British subjects to understand their financial priorities. The results are illuminating.

The research reveals the biggest financial goals across the U.K. this year, compared to 2019. The research revealed the percentage of people who are worried about being able to do a weekly food shop has increased by 21 percent since 2019.

With 2022 seeing the cost-of-living increasing drastically across the U.K., the research goes onto reveal the biggest financial goals across the U.K.,  highlighting what people are prioritising this year, compared to 2019.

Financial Future Goals in 2019 compared to 2022

Financial Future Goals20192022% Change
Being able to do a weekly food shop10.70%12.90%21%
Comfortably paying bills22.30%25.70%15%
Moving abroad4.30%4.90%14%
Having a secure savings pot17.70%20.10%14%
To achieve financial stability24.70%27.20%10%
Pay debts off22.00%23.90%9%
Be secure in supporting family11.20%11.60%4%


Since the cost-of-living crisis, spending habits have seen a change. Achieving financial stability was the leading financial goal in 2022, seeing a 10 percent increase since 2019.

U.K. inflation is rising at the fastest rate in 40 years, seeing food costs increasing and the cost of living putting a toll on banks. Lowell found that over one in five households want to be able to comfortably do a weekly food shop, a 21 percent increase since 2019.

According to the U.K. energy regulator Ofgem, the typical household could expect to see an £800 increase in energy use per year. Lowell’s data revealed a quarter of people (26 percent) said that comfortably paying their bills was one of their main financial goals in 2022, witnessing a 15 percent increase since 2019.

Young people’s spending habits have changed since 2019

 Criteria    Age range
16-2425-3435-4445-54
%%%%
Pay debts off – 201912%28%30%29%
Pay debts off – 202221%32%29%34%
% Change since 201969%15%-6%19%

The number of young people wanting to pay off debt has seen an increase since 2019; indicating that more young people have debt since the pandemic and the cost-of-living crisis.  Paying off debt among 16-24-year-olds has witnessed a massive 69% increase in priorities across the UK. The only age group to see a decrease, are among 35–44-year-olds who saw a decrease of six percent in priority since 2019.

Preparing for the future

Considering how the landscape has changed in 2022 and the challenges that people are facing, John Pears, UK CEO of Lowell, tells Digital Journal: “We’re all facing tougher times ahead, but this is particularly true for some of our most vulnerable households across the U.K. It’s important to try and be as prepared as possible, and realistic about your financial goals over the next year or two. Building a rainy-day fund, or improving your credit score, for example, might not feel financially realistic at this point in time, and that’s okay.”

Avatar photo
Written By

Dr. Tim Sandle is Digital Journal's Editor-at-Large for science news. Tim specializes in science, technology, environmental, business, and health journalism. He is additionally a practising microbiologist; and an author. He is also interested in history, politics and current affairs.

You may also like:

Entertainment

Jazz musician Courtney Pine gave a superb performance at the Union Chapel in London.

Technology

With 1 in 3 Americans impacted by data breaches, modernizing these systems and enhancing cybersecurity measures are essential in protecting patient data.

Business

The mine is projected to produce 58,000 tonnes of lithium per year - Copyright AFP Andrej ISAKOVICPresident Aleksandar Vucic said Serbia could exploit lithium...

Business

Renault Group chooses Exotec to automate the site of the Villeroy Parts and Accessories Logistics Department.