Have you ever wondered where all your money goes? Find out how an average household in the UK spends its income.
It’s no surprise, but many people are spending more than they earn each month.
There is a steady transition from cash and cheques toward plastic and digital payments, which often results in unforeseen fees and interest charges that contribute to overspending and ultimately, debt.
To learn more about where your money goes, check out the infographic below:
Here’s are the key findings worth reading:
- The median household disposable income in the UK was £28,400 per year in the financial year ending (FYE) 2018, which translates to about £2,367 per month, according to the Office for National Statistics.
- According to the same source, the average weekly household expenditure in the UK was nearly £573 in the same year, which translates to about £2290 per month.
- With the exception of food and restaurant expenses combined, transport was the category with the highest average weekly spend of £80.80, equivalent to 14% of households’ average total weekly household expenditure.
- Talking about England, the average weekly household spending was the highest in London and the South East (over £650), whilst spending in the North East was the lowest, approximately £200 less.
- Those aged 22 to 29 years have become less likely to own a home, with the proportion of homeowners having fallen by 10 percentage points between 2008 and 2017 – from 37% to 27%.
- They’re also less likely to have money set aside. More than half (53%) of 22 to 29 year olds had no money saved in a savings account or an Individual Savings Account (ISA) in 2014 to 2016, compared with 41% in 2008 to 2010. However, those who did had an average of £1,600 put away, up from £900.
- The good news is that the household savings ratio – which estimates the amount of money households have available to save as a percentage of their total disposable income – increased modestly to 4.2% for 2018 from a record low of 3.9% in 2017, in a sign that families are gradually getting back on their feet.
Spend and Save, Wisely
It may seem unlikely, but it’s possible to keep a track on how you’re spending your hard-earned money and budget better.
Here are some tips to do just that:
- Consider downloading a budget planner app to take the guesswork out and track every expense.
- Save on your dining expenses by cooking at home more frequently. Likewise, cancel that gym membership you don’t use and get fit on a budget.
- Review all credit card and bank statements as soon as you receive them and compare interest rates and fees from month to month. If you tend to carry a balance, consider using low-interest credit cards.
- If you use credit cards for fuel, groceries, and other bills, look into rewards programs that offer cash back on purchases at gas stations, supermarkets, drugstores, convenience stores, and utilities. Use credit card rewards to save money.
If you’re interested in diving deeper, please check out the following links: