Brits still spending on non essentials
Research from LV= claimed the average annual spend on lifestyle essentials is £6,194 per household (£5,850 in 2011), with the UK as a whole spending £9bn more than last year on these items, despite almost one in five (19%) people suffering a pay freeze during the same period.
In order to afford the more luxury items people deem essential to their lifestyle, over three quarters (78%) say they are making cutbacks in areas of household spending.
The most common cutback is buying cheaper or own brand basic food (48%).
Mark Jones, LV= head of protection, said: “The need to get away from it all is important to people when economic times are hard, which explains why holidays and weekend breaks remain the lifestyle aspect that most people are most unwilling to do without. It is no surprise that people are trying to ‘keep calm and carry on’, and making cutbacks in other areas to maintain the little luxuries in their life.”
The Lifestyle Inflation Index found the essentials have an overall inflation rate of 3.2% to August 2012, significantly more than the increase in the nation’s pay packets over the same period (1.5%).
However there is some light at the end of the tunnel as the inflationary rate of some lifestyle essentials slowed in the last year, with nights out at 2.5% from 6.6% in 2011, and takeaway meals increasing by 2.1% compared to 5.6%.
The Office for National Statistics reported the CPI inflation has fallen from 2.5% to 2.2% in September.