Households 'cut savings' to budget for everyday essentialsMonday, 21 March 2011 10:38
Ahead of the Chancellor's budget this Wednesday, new research reveals that 47 per cent of mums across the country will be reducing family savings by an average of £386.76 over the next year.
The UK Mums’ Budget, conducted by Family Investments, showed that a total of £1.3 billion would be cut from household savings as families struggle to meet the escalating cost of everyday essentials.
The study showed that not being able to save enough or anything at all was the second biggest concern after paying for utility bills, demonstrating that saving is still a priority for families.
Despite this, saving levels have been hit across the board, with mums making the most significant reductions, typically £20.18 per month, to short-term savings such as instant access ISAs.
Long term savings for children have also been hit in mums' budgets, but have seen the lowest impact overall in terms of cutbacks.
However, 21 per cent of mums will be trimming around £58.80 per year on saving for their children's futures, despite the rising cost of university fees, the mutual said.
Meanwhile, new research from the Institute for Fiscal Studies estimates that in the three years from 2008 to 2011 real household incomes will have fallen by 1.6 per cent, or £360 a year – leaving households six per cent worse off than they might have expected.