The British public has around £250 less disposable income than they did last year thanks to the cost of living crisis, according to new research.
In a study of 2,000 adults, conducted by MoneyBox, gas and electricity bills on average cost around £100 more a month than last year to around £248.
Participants of the study were forking out just over £60 more each month for housing costs compared to 12 months ago.
Travel expenses have increased by £105 with the average commuter now paying £221 compared to £116 last year.
Moneybox also found that savings pots had taken a hit, down 21% in the last year and three out of 10 people were now living paycheck to paycheck.
Even with the rising cost of living and the squeezed finances, Moneybox found that people were still trying to put away savings where they could with around six out of 10 people managing to put away a bit of cash each month.
Even though many respondents said they had to dip into their savings over the last year, on average people were still putting away around 20% of their monthly paycheck.
However, to be able to do this many cut back on so-called “non-essentials” with nearly a third saying they were going out less and budgeting much more, and nearly a quarter saying they were living to a “strict budget”.
Other respondents said they were able to put away the extra cash by selling stuff, starting a side hustle, working overtime, securing a pay rise, and even changing jobs.
Brian Byrnes, head of personal finance at Moneybox said: “It’s clear from this research that where possible, people are doing all they can to protect their savings and achieve their financial goals despite personal finances being stretched so much in such a short space of time, but of course, not everyone has the flexibility in their budget to plan for the future right now.
“If that’s the case for you, remember the most important thing you can do for your financial well-being in 2023 is to build positive financial habits that will set you up for success in the long term.”
Going forward into 2023, the majority of respondents said they were planning to manage their finances a lot more by setting up budgets, thinking about how they could be more financially resilient, and planning ahead more than ever before.
Brian added: “At one time or another, most of us will admit to not spending enough time managing our finances to help us achieve our future goals.
“Committing to taking some simple steps now to build positive financial habits such as budgeting, regularly reviewing your spending, and setting achievable financial goals, will all help you take control of your future finances and manage the impact of rising costs of living with greater confidence.
“It will also set you on the right path to achieve your goals as quickly as possible in the future.”
