New research from Make It Cheaper looks to find out just how much the UK’s pay squeeze is affecting the nation. As the average UK pay rises fall further behind the rate of inflation, households’ disposable incomes are decreasing as more money is spent on the same amount of goods and services for less value.
New research reveals one in three (33 per cent) admit they have to spend their entire wage on living costs, and a further 33 per cent struggle to live comfortably on the money they earn.
When it comes to the UK’s outgoings, these are deemed the worst value for money:
Train tickets (58 per cent)
Rent (56 per cent)
House prices (54 per cent)
Parking costs (51 per cent)
Petrol (47 per cent)
Energy bills (45 per cent)
Designer clothes (45 per cent)
Car insurance (42 per cent)
Organic food (39 per cent)
Income tax (36 per cent)
Unsurprisingly, more than half (58 per cent) of the UK believe train tickets are overpriced; uncapped price increases have seen the overall price of tickets rise by around 25 per cent since the mid-1990s, even when allowing for inflation. This year alone, they increased by a UK average of 2.3 per cent.
However, it’s not just trains
A quarter of all Brits (25 per cent) think fresh food is poor value for money, while only 17 per cent feel the same about store cupboard food, and 21 per cent about confectionary. This suggests those struggling financially are more likely to opt for cheap, but often nutritionally poor, foods such as biscuits, crisps and cereal when feeding the family.
Even confectionary price increases haven’t gone unnoticed; two thirds (66 per cent) of the UK said they were outraged by the increased cost of Freddo’s, which have increased from 10p to 25p over the last two decades, and is forecast to rise to 30p by 2030.
The average UK worker takes home £1,794.93 a month after tax; Make It Cheaper’s latest survey reveals that one in five (19 per cent) spend £1,000 to £1,249 on necessities every month, leaving as little as £550 for social and leisure activities, clothes, and savings each month. More than a quarter (28 per cent) state they have to be deliberately frugal when it comes to buying essentials, if they want to be able to treat themselves to experiences and luxury items.
When it comes to household bills, council tax is the most resented (53 per cent), followed by electricity bills (43 per cent) and gas bills (38 per cent). Nearly a third (31 per cent) hate paying for a TV Licence, while TV and broadband packages are seen as slightly better value (28 per cent). In contrast, only seven per cent think their monthly student loan repayments are overpriced, and just 13 per cent of the UK feel their national insurance costs too much.
Predictably, the main reason given for resenting paying bills is that they are too expensive (76 per cent). However, the fact that most bills are mandatory, with consumers having no choice but to pay came second (58 per cent).
The main reasons given for resenting bills
Too expensive (76 per cent)
Mandatory/ no choice but to pay (57 per cent)
See no benefit from paying (23 per cent)
No physical gain from paying (18 per cent)
Won’t use or claim (12 per cent)
Having prices that are continually raised, despite services being cut was a common theme among participant’s feedback, as is paying for shareholders and executives, rather than services.
One respondent, a 53 year old female from Manchester, says, ‘Prices keep rising, yet service keeps getting worse’, while a 44 year old male from Bristol said he felt ‘fleeced’ by companies raising prices several times a year, despite making ‘obscene profits’.
Nick Heath, head of insight at Make It Cheaper, says, ‘Mandatory bills with no choice of providers, such as council tax, can be infuriating as consumers have zero control over when and how much they pay.
‘Shopping around to get the best deal on utility bills, as well as groceries and other consumer goods, can save a decent amount of money each month. For utility bills, we recommend switching, or at least comparing providers, once a year to help combat company price increases.’