While the economy crashes and jobs are lost, many Brits have found that lockdown has been beneficial for their money in one tiny way: they’ve cut back their personal spending and managed to put away some extra cash.
When lockdown began, many of us had dreams of saving bucketloads of money due to no longer being able to fritter away our money on pub trips and the daily commute into work.
While some of quickly had those dreams by dashed by a new online shopping addiction and paycuts, others actually managed to stick to tighter lockdown budgets.
In fact, research from money.co.uk suggests that UK households have dramatically cut their spending, saving an average of £2,879 each in the 13 weeks of quarantining.
Should we keep up certain financial habits in lockdown, the experts behind this research reckon we could each save £8,638 by the end of 2020. Nice.
To show how much you could save if you maintain your lockdown budget, money.co.uk have created a calculator, which you can play around with on their website.
The areas where people have made the most savings have been on clothes (who needs a new outfit when you’re home all the time?), running the car, and meals out.
The survey found that UK households have saved £34.39 a week on average on buying clothes, £34.14 a week on running the car, and £33.57 on paying for meals out.
For Londoners, though, the biggest savings have come from decreasing alcohol consumption… or at least having the same alcohol at home rather than paying for overpriced pints at the pub.
On average, our decreased pub trips have saved us £27 a week, whereas for Londoners this jumps to £39 a week.
Cutting back on haircuts and beauty treatments has saved Brits around £25 a week, and ditching desk lunches and takeaway coffees has helped us put away a further £21 a week.
Salman Haqqi, personal finance expert at money.co.uk, said: ‘During lockdown, many people have cut back on their spending on non-essential items. The savings have been largely made by households cutting back on the amount of cash they spend on items like alcohol, cigarettes, clothes, make-up, cosmetics and grooming products, meals out, haircuts and beauty treatments, plus shop bought lunches and takeaway coffees.
‘They’ve also spent less because many are not having to use their car to travel to work and have also cut back on other outgoings like sports and gym memberships.’
While the end of lockdown may signal a return to our old spending habits (or, if Super Saturday is anything to go by, compensation for the months lost by spending immense amounts on booze and entertainment), the study also found that many people plan to keep up some of the financial habits they developed over the past few months.
If we do keep it up, we could save an average of £8,638 by the end of 2020.
If households continue to save at the same pace now that lockdown is relaxing, they could save an astonishing £8,638 on average by the end of 2020.
Salman adds: ‘Almost 8 out of 10 householders we surveyed (79%) say they aim to continue to save as much as possible even though lockdown is relaxing.
‘The biggest opportunity to save money, according to our study, is in cutting back on going for meals out. More than a third of the 2,000 people we surveyed said that would be the top priority for continuing to save money.
‘Cutting back on shop bought lunches (30%), takeaway coffee and new clothes (29%), running the car (20%) and buying alcohol (17%) are the other areas people are likely to continue to try and cut back in order to save once lockdown is over.’
Easy ways to save some extra cash
Another survey, this time from Utilita, asked people for how they’re savvy with money. Here’s what they said.
- Boil a kettle only with the quantity of water you will drink
- Do your own household DIY jobs
- Keep a spare change jar
- Wash the car yourself
- Drink tap water
- Air dry all clothes – even towels and bedding
- Keep an eye on your bank balance
- Do one big shop at the weekend, rather than loads of little shops through the week
- Make snacks instead of buying them, bake cakes instead of buying them
- Grow fruit and vegetables
- Buy things like toilet roll or deodorant in bulk
- Make and stick to a budget
- Cook batches of meals for the whole week
- Reuse wrapping paper or gift bags
- Buy rechargeable batteries
- Make recipes by only using ingredients you already have
- Cycle or walk instead of using the car or public transport
- Patch jeans
- Renovate old furniture
- Resole shoes
- Unload the car before driving
- Repair broken household appliances
- Clean with vinegar
- Sew on buttons
- Log all household spends
- Redesign an old dress instead of buying a new one
- Put several used bars of soap together
- Never pay the asking price / haggle for a good deal
- Learn basic house maintenance instead of hiring help
- Hand down clothes between generations