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Consumers 'expect budget squeeze'

Half of people expect their budgets to be squeezed even harder in 2014 than in 2013, consumer group Which? has found.

Despite some recent signs of improving consumer confidence amid better news about the economy, 49% of more than 2,000 people surveyed in December predict their finances will come under increased pressure next year.

Less than one third (29%) of those asked expect their family's financial situation to improve in 2014 - and after a string of price hike announcements by energy firms, three-fifths (60%) of consumers said they are already "dreading" the cost of their winter fuel bill.

The research also found that a quarter (25%) of people could only afford to pay for Christmas by borrowing. One third (34%) of people dipped into their savings, taking an average of £450 from their accounts.

Three quarters (76%) of those borrowing money put it towards presents, with four in ten borrowers (44%) also using credit to pay for food over Christmas.

Which? found that 30 to 49-year-olds used more credit than other age groups, with those who borrowed taking on debts of around £490 to pay for Christmas compared with the average of £350.

They were also more likely to have dipped into their savings and those in this age group who did took out an average of £570. This age group also felt most under pressure financially, with 41% saying they felt squeezed.

Richard Lloyd, Which? executive director said: "Despite continuing signs of an improving economy, it seems families are still really feeling the squeeze, with millions of households pessimistic about their finances in 2014 after relying on savings or debt to fund Christmas spending.

"We want a New Year resolution from the Government to do more to help hard-pressed consumers in 2014 by getting a grip on the cost of essential bills and a resolution from firms to make sure they are giving customers the best possible value for money."


From Belfast Telegraph