BUYING CLOTHES AND TAKEAWAYS FIRST OF FEBRUARY’S FINANCIAL SPLURGES
The average Brit will spend £391 more in February than they did in January – rising to £568 for millennials
Brits could make 2020 savings of £4,962 if they stayed in control of their financial habits throughout the year
Money management measures to be abandoned first are clothes buying bans (26%), not getting takeaways (21%) and setting a budget and sticking to it (20%)
Zopa, the FeelGood Money company, has compiled a list of the top things that people can do to manage their finances through February and beyond
Brits have been scrimping and saving across January, but as pay day arrived last week one in 10 (1.6 million people) are set to break their spending ban in February.
Encouragingly almost a third (32%) want to try and carry on most of their January savings habits, with over half (54%) stating they’ll try to carry on a few into the rest of the year. However, as normal spending service resumes the average Brit will spend £391 more this month than they did the last – rising to £568 for millennials.
The research by Zopa, the FeelGood Money Company, found that while some positive financial habits are abandoned in February, most fall by the wayside after an average of five months. But if positive money saving measures continued throughout the year, Brits would save an average of £4,692 and by 2030 could have banked a whopping £46,920.
A desire for a more sustainable lifestyle could have been a key driving factor in saving money in January – the average person saved £52.24 not buying new clothes, which rose to £71.08 for millennials. However, now that February has hit, the lure of the shops proves too much with a ban on finances for fashion being the most popular financial habit to be broken first.
Many people also chose to give up alcohol or meat and dairy for January, with those aged 25-34 taking part in these initiatives more than any other age group to save a combined average of £110.09. Those that took part estimate their good intentions will hold out for five months, which could see them save £550.45 by May, or a huge £1,321.08 if they held out until the end of the year.
The money management tactics most likely to be given up first are:
- Not buying clothes – 26%
- Not getting takeaways – 21%
- Setting a budget and sticking to it – 20%
- Drinking less – 19%
- Going on fewer nights out – 19%
- Not drinking at all – 17%
- Not going out altogether – 17%
- Making more packed lunches – 15%
- Putting aside savings – 14%
- Spending more time exercising – 14%
- Stop going on dates – 12%
- Eating a vegan diet – 10%
Clare Gambardella, Zopa’s Chief Customer Officer, commented: “After a frugal January it can be tempting to splash out once you get paid, but making small financial changes can help people feel in control and good about their money all year round. Anyone looking to improve their financial position throughout the year should download the Zopa app – our Borrowing Power function helps to improve credit health, provides actionable insights to increase credit scores and unlocks great value loans for those that need them.”
Zopa, the FeelGood Money company, has compiled a list of the top things that people can do to manage their finances through 2020 and beyond:
- Create a budget: it may seem obvious, but this tactic will pay off. Keeping a budget to manage income and outgoings provides clarity that can help you feel good about your finances
- Cut out ‘unnecessary’ expenses: you don’t need to remove all luxuries from your lifestyle; however, many people rack up money on things such as unused gym memberships and subscriptions. Check out which subscriptions you are really using and if there are any savings that you can make
- Give yourself monthly challenges: our research found that things such as Veganuary and dry January returned savings for those that tried it. Review an option that you think could suit your lifestyle and give it a try for a month
- Consolidate debt: for those that have more than one debt, and therefore separate payments and perhaps different interest rates – consolidating debt can be beneficial. It reduces the number of monthly payments, which can be easier to manage
- Improve your credit health: improving your credit health provides access to the best rates when it comes to borrowing. The top things to improve your position include using a credit card little and often, keeping utilisation low (preferably under 30% of your limit), register to vote, and don’t make numerous hard searches. There are also a number of freely available tools, such as Zopa’s Borrowing Power, that offers personalised tips based on exactly what is impacting your credit health
Borrowing Power is an innovative tool designed to help Zopa customers get access to cheaper credit. Hosted within Zopa’s app, the tool is available for anyone to download via the App Store and Google Play.