More UK households cutting back on spending

| January 23, 2012 | 0 Comments
More UK households cutting back on spending

Nearly one third of adults in the UK expect to spend less in 2012 compared with around a fifth in October, according to the Resolution Foundation, an independent research and policy organisation which aims to improve outcomes for people on limited income.

The survey, which was carried out by Ipsos Mori on behalf of the think tank, suggests that people have become more pessimistic about their finances since autumn last year, when the eurozone crisis worsened.

Twenty-three per cent of respondents to the survey said they expect their financial situation to deteriorate over the next 12 months, compared with just 15 per cent in October, when the survey was last carried out.

The latest survey also found that more people are now saving, with 30 per cent of respondents saying they were putting money away every month, compared with 22 per cent in October.

A fifth of respondents to the survey said they would not be able to go away on holiday this year.

Gavin Kelly, the Resolution Foundation’s chief executive said: “The longer households cut back on spending, the longer it will be before we see real economic recovery.”

The survey is part of a wider report by the Resolution Foundation, which will be launched today.

Called ‘Squeezed Britain’, the report will highlight the pressures on low- and middle-income households.

Last week, housing charity Shelter warned that more than a third of people have cut back on their food bills in the last year, in order to pay their mortgage or rent.

This represents an increase of 44 per cent since 2008.

Campbell Robb, chief executive of Shelter, said: “These staggering findings show just how many millions of people are cutting back on essentials as the continued squeeze on incomes starts to really bite.”

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