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New research from Abbey Credit Cards has revealed that Brits are now opting for a ‘no frills’ approach to spending in a bid to get through the credit crunch. This has involved people stepping away from grandiose or complex purchases.

For 57 percent, ‘no frills’ products are thought to be basic but good value for money. However, 22 percent would describe such a product as being in line with what it says on the tin. Further to the research, the top five ‘no frills’ products were revealed along with the percentage of adults in the UK that would be happy to purchase them. These include: household products at 73 percent, food at 65 percent, toiletries at 50 percent, clothes at 44 percent, and holidays at 42 percent.

Compared to 12 months ago, 58 percent of those surveyed said that they are now more inclined to spend their money on ‘no frills’ products. Those under the 20 years of age were found to be most prone to making such purchases, while this is true of 61 percent of women and 54 percent of men. For 30 percent, this approach to spending has always been part and parcel of their lives.

Managing Director of Abbey Credit Cards, Roger Lovering, said: “It’s no surprise to see Britons reassessing their spending habits at a time when every penny counts, and it’s encouraging that so many of us are embracing the ‘no frills’ lifestyle. In today’s difficult economic climate, reviewing your monthly expenditure to find ways you can make your money go further is absolutely essential, which is why straightforward, good value products are the order of the day.”

In addition to the findings above, the research also showed a regular annual increase in the propensity of people to buy second-hand items. In particular, the purchase of second-hand ‘white goods’ has been subject to a 5 percent rise from 30 percent to 35 percent.

Homeowners who are struggling to keep their finances in the black as a result of the recession may wish to consider taking out a debt consolidation loan. This finance option could be a consideration to those that are juggling expensive, personal loan repayments each month. A debt consolidation loan could be used to lower total existing outgoings by tying up these debts into one manageable monthly repayment over a longer period of time. When taking out a debt consolidation loan, it must be remembered that consolidating your debt may increase the amount you pay back overall and extend the repayment periods of your debts.

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According to Abbey Mortgages, 1.6 million people aged 18 to 34 in the UK are living rent-free with their friends or family. This level of reliance highlights the extent to which the recession has affected people’s personal finances.

This trend of being dependent on friends or family is not specific to any one social group but is instead applicable across the board. The research even revealed that 300,000 people between 34 and 54 years of age also have the same living arrangement. The total number of people in this situation in the UK stands in excess of 1.9 million. With the average monthly rental payment at £441.78 this means an overall saving of £839 million for those who are living with their friends or family free of charge. For this reason it is unsurprising that the average age of a first time buyer has risen to 29.

It comes as no surprise that it is the areas in which property prices are typically expensive where the greatest number of people are not able to purchase a house themselves. Within London for example, over 270,000 adults are living rent free. People in the South of the country are twice as likely to be living in this way compared to the North East and North West.

Abbey Mortgage Director, Nici Audhlam-Gardiner, commented: “In the current climate many people have little choice but to return home or turn to their friends or family for somewhere to live at no cost. Whilst an adult living at home until their 30s is more associated with our continental cousins, Abbey Mortgages research shows that this is a trend that is on the increase here in the UK as well. This time last year less than half a million people claimed to be living rent free. Today this figure has leapt to almost two million.”

Those first time buyers who have been able to get onto the property ladder and would like to turn their new home into their dream property may wish to consider taking out a secured loan to fund the work required. One of many finance options available, a secured loan could provide the means to an array of home improvements from redecoration to a new kitchen or bathroom. Those wanting to create extra living space could even use the money to fund a conservatory or extension. Secured loans could be used to fund extensions upwards and downwards too if a loft or basement conversion is appropriate.

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According to Abbey Credit Cards, Brits are making their money go further thanks to a more cautious approach to spending. In fact, the average UK salary of £25,100 is being stretched by 7 percent, which equates to an average annual saving of £1,746.

Penny-wise activities, such as shopping around, are resulting in savings in a multitude of areas. 69 percent of UK adults have seen a £17.10 reduction in their weekly food bill; 46 percent have saved £17.27 per week on their travel expenses; 61 percent have made a weekly entertainment saving of £19.47; 51 percent have experienced an annual saving of £229 on holidays; and 35 percent have saved £139 on financial products during the course of the year.

This thrifty approach to spending looks set to stay, judging by the response that many Brits are intending to cut back further still this year. Specifically, 55 percent intend to save even more on their food bills; 41 percent are planning to further reduce their travel expenses; 48 percent are aiming to shell out less for entertainment; 47 percent are looking to make holiday savings; and 30 percent are resolving to save more on financial products this year.

The methods behind the savings are varied. The findings conclude that impulsive spending is becoming less common, with 37 percent making price comparisons in at least five shops prior to making a purchase. 68 percent were also found to postpone buying an item until it has gone on sale. Abbey Credit Cards also point out that ‘shabby chic’ is making a come back with 31 percent of Brits being willing to visit car boot sales in an effort to obtain a bargain. 40 percent also choose to don clothes bought from charity shops.

The general British feeling of unease where haggling is concerned would also appear to be less apparent today, with four in ten people being prepared to do just that. One in eight respondents claimed that they are no longer prepared to pay the ticket price for non-food items.

Head of Credit Cards at Abbey, Callum Gibson, commented: “At a time when people’s finances are becoming ever more stretched, it’s not surprising that Britons are becoming more astute about how they shop and are prepared to shop around and economise to make their money go further. But savvy spending isn’t the only way that Britons can make key savings. Recent research by Abbey Credit Cards found that by transferring to a 0 percent deal, Britons with an outstanding credit card balance could save an average of £443 a year, a huge saving in today’s difficult economic climate.”

Homeowners that are finding their finances tight may wish to consider taking out a secured loan. This finance option could prove to be an ideal solution, particularly for those that are currently juggling multiple repayments on credit cards each month. A secured loan could be used to consolidate such debts into one manageable, monthly repayment. This could potentially be lower than total existing monthly outgoings, thus freeing up useful money used elsewhere. Secured loans are one of many options to consolidate debt, but it must be remembered that consolidating your debt may increase the amount you pay back overall and extend the repayment periods of your debts.

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According to Abbey Savings, practically two fifths of soon-to-be first time buyers are increasing the rate at which they save towards a deposit this year.

Of those that have already commenced saving, 38 percent said that they are intending to do so at a more rapid pace during the course of 2009.  In addition, 40 percent of those that had not already commenced saving said that they are looking to rectify this over the coming year.

As house prices continue to tumble, those with an existing deposit said that they are planning to save an average £203 more per month this year in a concerted effort to mount the property ladder.  Those that are intending to begin saving this year said that they are intending to save an average £123 per month.

The results of the research also showed that the average first time buyer is aiming for a deposit of £20,000.  However, regional differences are apparent with Londoners being under the impression that they will need £26,641, which makes London the area with the most substantial savings target.  In contrast, inhabitants of the Midlands are looking to build an average deposit of just £13,635.

While 38 percent of respondents said that they are intending to build up their deposit this year, 15 percent of those that already possess a nest egg for this purpose have said that they are not intending to put aside as much this year as they have done previously.  On average this group look set to save £74 less each month.
Director of Savings and Investments at Abbey, Reza Attar-Zadeh, commented:  “Homeownership is beginning to look like a much more realistic goal for thousands of first time buyers who have clearly been keeping an eye on house prices.  Building a deposit is no small task, but those who have chosen to start putting extra money away are clearly better prepared to make an offer on a property when they see their opportunity.  Savers need to be aware that a large deposit will make it easier for them to be accepted for the best mortgage deal.  Abbey’s First Home Saver has been specifically designed to help savers build up a reasonably size deposit, allowing you to put money away regularly up to a sum of £50,000″

First time buyers who are looking to create their dream property, once they have moved in, could consider the option of taking out a secured loan to fund the home improvements.

A secured loan could be used to finance a range of projects such as fitting a new kitchen or bathroom. Larger scale projects including extensions, loft conversions and conservatories could also be funded with a secured loan.

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According to new research conducted by Abbey Savings, it would seem that the British are intending to save their way through the recession.  Despite falling Bank of England interest rates and the reduction in VAT, the majority of consumers are cutting back on their expenditure.  In fact, only 13 percent claim that their spending has remained unchanged.

Director of Savings and Investments at Abbey, Reza Attar-Zadeh, commented: “In the current climate many people are determined to tighten their belts.  It can be surprising how even making a few small changes to our way of living, such as buying a cheaper brand of food or ditching take-aways in favour of making something from scratch, can add up to hundreds or even thousands of pounds in savings over the course of a year.”

Abbey’s research revealed five key areas in which people are planning to curb their spending.  69 percent are reducing the amount that they spend on food by means of purchasing cheaper brands or by shopping at a cheaper supermarket, which is saving them an average of £17.10 per week.  61 percent are refraining from going out as much, which is saving them an average of £19.47 per week.  51 percent have decided to alter their holiday plans by going on day trips as opposed to going away, which is saving them an average of £229 annually.  46 percent are walking or cycling more rather than using the car or public transport, which is saving them an average of £17.27 per week.  Finally, 35 percent have switched financial products to make savings, which is saving them an average of £139 annually.  To summarise the extent of the savings being made, Britons have each lowered their expenditure by an impressive £3,168 during the course of the past 12 months.

In terms of which generation is being the most frugal, it may come as surprising news that those between 18 and 34 are tightening their purse strings more so than their seniors.  Within this young group, spending has been reduced by £3,599 during the past 12 months.  In contrast, those over the age of 55 claimed to have saved £2,773 of their annual expenditure.

Abbey’s research also revealed that people are most likely to reduce the amount spent on food, regardless of their location.  The top three methods of saving money include opting for cheaper goods in the supermarket, reducing the number of take-aways purchased and reducing the number of meals out.  These are common across all regions of the UK.  However, where other methods are concerned things aren’t quite as consistent.  For example, 40 percent of those living in the Midlands claim to be using their car less whereas only 20 percent of Londoners are cost-cutting in this way.  Nevertheless, 31 percent of Londoners do appear to be taking advantage of nearby forms of entertainment by making the most of free services such as libraries, museums and outdoor concerts.  Just 20 percent of people are doing this in the North, Yorkshire and Humberside.

Those whose finances are tight a result of the recession may wish to consider taking out a secured loan to consolidate existing debts.  This finance option could be a solution for those that are juggling multiple, confusing monthly repayments.  A secured debt consolidation loan could be used to tie up all those existing debts into one simple, potentially lower, monthly repayment. It should be remembered however, that consolidating your debt may increase the amount you pay back overall and extend the repayment periods of your debts.

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Many may be familiar with the term ‘Baby Boomer’ but Abbey Mortgages has now identified a new generation that they have titled ‘Baby Boomerangers’.  This phrase has been coined to describe those that return to live with their parents.

The latest research conducted by Abbey Mortgages has revealed that 20 percent of UK 18 to 24 year olds either returned to the nest in 2008, or stalled plans to leave it, in a bid to save the pennies.  Interestingly, the research has also shown that it is not just this younger group that have taken this decision.  In fact, 440,000 people aged 25 to 34 have followed suit, along with a further 471,000 people between 35 to 44 years of age.  Combined, this figure stands in the region of 2 million nationwide.

In terms of regions, ‘Boomerangers’ are primarily Northern, with 33 percent from the North of England and 22 percent from the South East.

Director of Abbey Mortgages, Nici Audhlam-Gardiner, remarked: “Millions of Britons have realised that sometimes you have to take one step backwards in order to go two steps forward.  So while returning home or delaying your plans to move out might feel like a sacrifice, it’s actually a great opportunity to save enough money to put down a deposit on a property of your own.  This is especially important in the current market where the bigger deposit, the better the mortgage rate you will be eligible for.”

When ‘Boomerangers’ have saved a sufficient sum of money in order to return to the property ladder, or indeed to get onto it for the first time, they may wish to consider taking out a secured loan to fund those vital home improvements once they have moved into the property.  This finance option could be used to put that all-important, personal stamp on a property in order to create that dream living space.  Repayable over a term to suit the borrower from 5 to 25 years, a secured loan could be used to finance a range of projects such as building an extension, or fitting a new kitchen, bathroom or conservatory.

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According to Abbey Savings, practically two fifths of soon-to-be first time buyers are increasing the rate at which they save towards a deposit this year.

Of those that have already commenced saving, 38 percent said that they are intending to do so at a more rapid pace during the course of 2009. In addition, 40 percent of those that had not already commenced saving said that they are looking to rectify this over the coming year.

As house prices continue to tumble, those with an existing deposit said that they are planning to save an average £203 more per month this year in a concerted effort to mount the property ladder. Those that are intending to begin saving this year said that they are intending to save an average £123 per month.

The results of the research also showed that the average first time buyer is aiming for a deposit of £20,000. However, regional differences are apparent with Londoners being under the impression that they will need £26,641, which makes London the area with the most substantial savings target. In contrast, inhabitants of the Midlands are looking to build an average deposit of just £13,635.

While 38 percent of respondents said that they are intending to build up their deposit this year, 15 percent of those that already possess a nest egg for this purpose have said that they are not intending to put aside as much this year as they have done previously. On average this group look set to save £74 less each month.

Director of Savings and Investments at Abbey, Reza Attar-Zadeh, commented: “Homeownership is beginning to look like a much more realistic goal for thousands of first time buyers who have clearly been keeping an eye on house prices. Building a deposit is no small task, but those who have chosen to start putting extra money away are clearly better prepared to make an offer on a property when they see their opportunity. Savers need to be aware that a large deposit will make it easier for them to be accepted for the best mortgage deal. Abbey’s First Home Saver has been specifically designed to help savers build up a reasonably size deposit, allowing you to put money away regularly up to a sum of £50,000″

First time buyers who are looking to create their dream property, once they have moved in, could consider the option of taking out a secured loan to fund the home improvements. A secured loan could be used to put that all-important, personal stamp on a property in order to create the ideal living space. Repayable over a term to suit the borrower from 5 to 25 years, a secured loan could be used to finance a range of projects such as fitting a new kitchen or bathroom. Larger scale projects including extensions, loft conversions and conservatories could also be funded with a secured loan.

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On the eve of St Valentine’s Day, it would seem that over 10 million are cutting back on the Valentine’s Day spirit. According to Abbey, 5 million of us are dining in rather than out. Gents are worrying more than ladies about how their partners may react to cutbacks as romance appears to be the latest thing to suffer as a consequence of the credit crunch.

More than half of us will be celebrating Valentine’s Day, however 39 per cent will spend less than in years gone by. Some will take advantage of two for one meal deal vouchers, and some will go out for dinner the day before or after Valentine’s Day to avoid overpriced meals on the days itself.

When it comes to Valentine’s Day presents, it would seem that less is more. Over a third who are cutting back intend to do so by spending less on presents for their loved ones. More than a quarter say they wont buy a gift at all, and more than 12 percent have decided to make rather than buy their Valentine’s cards this year. On average, cutting back is said to potentially save cash strapped lovers on average £42 each. Men supposedly worry more than women about this, with 18 per cent versus 6 per cent.

Commenting, Susan Voase, Abbey Banking spokesperson, said “Cash-strapped Britons will be hoping that it’s still the thought that counts as they turn to more cost-effective ways to show their love this Valentine’s Day. But while romance may be the latest casualty of the credit crunch, more than half of us are still planning to celebrate Valentine’s Day this year, proving that romance is down but not out by cooking a meal at home this year to save money.

Romantic homeowners who have used credit or store cards to purchase Valentine’s gifts, or who are still counting the cost of Christmas, could consider taking out a secured loan to consolidate their existing debt. One of many options, to refinance existing debt, a secured loan may be repaid over a term to suit the borrower from 5 to 25 years. When using a secured loan to consolidate existing debt, it should be remembered that consolidating existing debt may increase the amount paid back overall and extend the repayment period of your debts.

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According to new research conducted by Abbey, over 3 million Britons (7 percent) look set to move in excess of 7 billion pounds between credit cards this quarter. This is expected as a result of people taking advantage of introductory balance transfer periods.

Those switching credit cards will transfer an average balance of over £2,000 between providers, as many of them make a start on their common New Year’s resolution to organise their finances. This particular resolution has become somewhat of a tradition for many Britons. During the same period last year, an estimated 8 billion pounds was shifted between credit cards.

The research revealed that Britons within the age bracket 25 to 34 are most likely to be intending to transfer their credit card balance in the New Year (15 percent). In contrast, those between 55 and 64 years of age are least likely at just 3 percent. Those aged 35 to 44, and 45 to 54, come in at 8 percent and 6 percent respectively.

In addition it was found that people in Scotland and Northern England are more likely to transfer a credit card balance (8 percent) than those in Wales and the South West (4 percent).

Callum Gibson, Head of Credit Cards at Abbey, comments: “The New Year is an ideal time for people to review their finances and by transferring a credit card balance to a card with a 0 percent introductory offer, consumers can ensure they are managing their finances as effectively as possible. As well as offering customers a 0 percent interest rate on balance transfers for nine months and purchases for three months, the Abbey Credit Card also pays 3 percent cashback on supermarket and petrol purchases for six months up to a maximum of £75, helping consumers to make their money go further.”

Homeowners that are juggling multiple credit card repayments may want to consider combining their debts with a secured, debt consolidation loan. This option would result in just one simple, potentially lower, monthly repayment. In addition, secured loans are repayable over a term to suit the borrower, from 5 to 25 years. However, it must be remembered however that repaying the borrowing over a longer term may increase overall interest charges.

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Recent news from Abbey reports that disposable income has dropped 29 per cent compared to two years ago. The majority of Brits are regularly having to make sacrifices in the run up to payday and current accounts are empty on average 5 days before pay day. As Christmas draws closer, 29 million say that they will have to make sacrifices.

Based on their own research, Abbey found that Brits are now spending around 75 per cent of their monthly wage on essentials. Hardly a surprise, the main dent for the majority of us Brits is due to rent or mortgage payments with nearly a quarter going on this alone. Household bills and food is costing an average of 16 per cent each.

Around 29 million Brits will be making sacrifices over the next few months to help them get through this costly time of year. Initially, the most likely pleasure to go is socialising, with 43 per cent of us giving up going out when we’re running low on funds. New clothes and cosmetics are next to go with 17 per cent and 6 per cent of us giving these up. Some people are even happy to give up food at the end of the month rather than give up anything else.

Commenting on the survey, Steve Shore, Director of Banking at Abbey, said: “A staggeringly high number of people regularly fail to budget effectively each month and end up running out of cash before their next pay cheque. With disposable income down and Christmas almost upon us, planning your finances carefully has never been more important.”

When it comes to budgeting, those living in the North of England were found to be the worst as 67 per cent regularly run out of money in their current account before the end of the month. Best at budgeting are said to be those living in Scotland, just 48 per cent forgo purchases as the end of the month draws closer. The poorest planners were found to be youngsters. 81 per cent regularly run out of money in their current accounts before the month ends. The best budgeters are reported to be 55-64 year olds, just over half of which run out of money before the month ends.

Homeowners who have overspent on store cards and credit cards in the run up to Christmas could consider consolidating these in the new-year with a secured loan. One of many options to consolidate debt, a secured loan can be repaid over a term to suit the borrower, potentially reducing monthly outgoings. It should however be remembered that repaying borrowing over a longer term may increase overall interest charges.

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