Coronavirus has, as everyone is aware by now, impacted the economy both nationally and globally. There have been numerous studies on its effects on the world’s finances and new analysis from the ONS highlighted the impact it is having on families within the UK.
In findings revealed on June 11, the ONS detailed that more than one-fifth of usual household spending has been largely prevented during lockdown (for instance, due to shops and restaurants being closed).
They detailed that this could equate to hundreds of pounds per household.
For many families, these newly available funds were likely to be used for essentials that lost income would have usually covered.
Unfortunately, many people who had their hours reduced or lost their job entirely would likely need as much money as possible just to survive.
However, there may also still be some people who have managed to retain both their regular working hours and this excess cash.
Salman Haqqi, a Personal Finance expert at money.co.uk, commented on the findings from the ONS: “The closure of shops, restaurants, bars, and travel, means weekly household spending has been down.
“New data reveals that households are spending, on average, £182 less each week under lockdown.
“For many, this has come alongside reductions in income.
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“Therefore, any cuts in non-essential spending are a welcome relief on squeezed budgets.”
He went on to provide advice for the lucky few who have found themselves with more income than normal: “For people lucky enough to be earning full wages, the lockdown has presented a golden opportunity to pay off debts or save.
“Those in debt should prioritise paying it off, be that on a credit card, loan, or mortgage.
“Then it’s time to save. While it’s not currently a savers market, there are still deals to be had.
“Ensure you check the best savings rates available, to make sure your money will work the hardest it can for you.”
Many organisations, both public and private, have produced advice in recent months for worried consumers.
Coronavirus has impacted everyone’s financial commitments in some way or another and as such, different people will need different guidance.
Fortunately, the Money Advice Service has come up with a checklist of sorts which can help people identify what their priorities should be.
Their advice follows a four step process that could be applicable for everyone:
- Step one – do an emergency budget
- Step two – check on insurance policies
- Step three – talk to creditors if payments may be missed
- Step four – use savings where possible
Published at Sat, 13 Jun 2020 19:23:00 +0000