A study by Skipton Financial Services has found that the average UK family needs to have £24,801.51 a year in order to survive. The figure is arrived at by adding up things like mortgage payments, food bills, petrol bills, the cost of commuting and more. It also takes into accounts the bare minimum of spending for things like children’s clothes and things they’ll need for school.
However, what is left out of the report are any luxury items. The managing director of Skipton Financial Services, Andrew Barker, believes that pointing this out shows just how high the figure really is: “The worrying thing is that the report doesn’t include any luxuries whatsoever, the figures only refer to the money people need to survive. Don’t forget that £24,801.51 is the figure UK families need to bring home so, once income tax and national insurance has been taken into account, a basic rate taxpayer would actually have to earn well over £30,000.”
To have both parents together achieve a £30,000 is difficult, but add to that the pressures of raising children and going without holidays, trips to the cinema, nights out or other ways of relaxing and life may soon become unbearable. Some people choose to make up these shortfalls with temporary short term loans, but then have to accommodate the repayments on those further down the line.
It’s inflation that’s to blame, says Mr Barker: “When we first carried out this research in 2011 we knew that people were feeling the pinch, with inflation riding high at 5 per cent and savings accounts paying rock-bottom rates. However even we were surprised that families needed to bring home almost £25,000 just to stand still. Unfortunately, despite inflation now nearer to the Government’s 2 per cent target, many families are still in exactly the same position as a year ago, with almost 60 per cent saying they have less disposable income than last year.”
As the cost of everything from food to petrol increases, people will find that their wallets are ever barer.