Nearly a quarter of UK adults (24%) are using their savings to cover the rising cost of living – equating to 12.7 million people across the UK.

New research from UK credit provider Vanquis reveals most Brits (82%) are worried about rising prices, and more than half (53%) are cutting back on essentials as a result. A similar amount of people (51%) expects their household financial situation to worsen in the next 12 months.

The top five cost concerns are:

  1. Household bills (71%)
  2. Food shopping (61%)
  3. Transport and petrol (43%)
  4. Rent or mortgage payments (17%)
  5. Phone or broadband costs (11%)

This week, as the Consumer Price Index (CPI) inflation reaches its highest rate in 40 years, Vanquis are launching a free cost of living calculator. The calculator helps people understand how rising prices could impact their finances and signposts useful advice to save money on bills.

The research also reveals that women are more concerned than men (88% v 75%) about rising costs. As such, they are more likely to cut back on essentials (61% v 45%) and more women than men expect their financial situation to get worse over the next year (56% vs 47%).

In general, four in 10 people (43%) don’t know how the rising costs will impact them, this increases to over half (53%) of younger adults, highlighting that this group may need additional support.

Six in 10 adults (60%) say they would find support with the rising cost of living useful, however more than half (55%) don’t know where to find it.

Fiona Anderson, Managing Director of Cards at Vanquis comments: “The cost-of-living crisis is a huge concern for many people and this week’s inflation announcement shows how prices are continuing to rise.

“Though saving on everyday spending is not the answer to the crisis overall, our calculator aims to give people a clearer picture of how the increases may impact them and share ideas to help save money.”

The Vanquis cost of living calculator is free to use and available here

The latest hike in petrol costs is set to cost the average UK driver an extra £700 a year – more than 60 percent of their spare income.

This is according to used car buying service, ChooseMyCar.com, who have used data on their most popular cars to calculate the costs of filling up tanks today, compared to a year ago. What they found was that based on an average mileage of 13,000 miles a year, the extra cost of filling up tanks is upwards of £25 per tank. Spread across the course of a whole year, that’s of a minimum of £525. Even in a “reasonable” car, such as a Nissan Qashqai, the extra cost is nearly £700. A full comparison of their top 10 most popular cars can be found here.

According to the recent Worldwide Wage Report, that’s more than 60 percent of your average Brit’s spare income.This is particularly concerning in the light of a study that ChooseMyCar.com commissioned earlier this month. This study shows that half of 18-34 year olds have had to borrow money to pay for fuel, either from friends and family – or banks.

Other worrying statistics from that study showed:

  • Over half of 18-34 year olds had had to cut back on groceries to afford running their car
  • 80 percent said they would now have to walk where feasible due to fuel costs\
  • 76 percent of UK drivers admit to resorting to potentially dangerous hypermiling techniques to save fuel

 

Founder of ChooseMyCar.com, Nick Zapolski, said that many people are going to struggle to accommodate any further rise.

“The AA and the RAC have both confirmed that last Sunday saw the highest fuel prices ever recorded, with further increases expected over the coming days and weeks

“The cost of living is already so high, but fuel prices are absolutely staggering. It’s going to force some people to stop using their vehicles, which sadly isn’t practical for many.

“We already know that more than 50 percent of people are using “Hypermiling” techniques in order to be more economical. But despite their best efforts, our recent studies show that the impact on Brit drivers of fuel costs is already severe. How much more can people afford to pay?

“While prices continue to rise, all we can recommend is that people follow tips to drive economically.”

Analysis of the latest CACI market data by Paragon Bank shows that £418 billion of savers’ money continues to languish in savings accounts paying less than 0.1%.

CACI’s database1, which captures savings data from more than 30 leading providers, showed that four out of five (80%) of non-ISA instant access accounts pay less than 0.1% in February, despite the Bank of England Base Rate increase during that month.

The CACI data also showed that nearly a third (31%) of savings accounts have a balance of less than £100, suggesting people have little to fall back on during a period of high inflationary pressure.

February’s data confirmed that despite these cost pressures, the nation’s overall savings balance increased during the month to £988 billion, up from £986 billion the previous month.

Non-ISA instant access balances led the jump, increasing month-on-month by £3 billion to £615.4 billion. This type of product accounts for nearly two thirds (62%) of all savings balances. The average savings balance is £12,511.

Instant access ISAs remain the second most common account at 18.6% of all balances, or £183.4 billion.

Derek Sprawling, Paragon Bank Savings Director, said:

“It is remarkable that £400 billion of savers’ money is sitting in accounts paying up to 0.1% and it demonstrates how the high street banks rely on consumer apathy. In this inflationary environment, I would urge savers to make their money work as hard as possible for them and to seek better rates of return for their finances. Unfortunately, for too many people convenience trumps rate, but that needs to change.”

It’s been a better few months for savers with interest rates on the up for the first time in a few years, but it’s not just personal customers who are benefitting from better savings deals, rates for business savings are looking healthier too.

Many businesses keep too much money in their current account rather than using some of it make a bit of interest on cash they don’t need immediately.

There are a range of savings options to suit all businesses, from instant access savings to notice accounts where you typically can access your cash in 1 to 3 months and then there are fixed rate bonds paying higher still returns if you’re able to lock some cash away for a little longer.

If you leave the money in the business current account then it’s your bank who benefits and not you, so why not make some of your money work for you by generating some additional interest income.

Here are some of the best deals available today 10th May:

Easy Access Savings

Notice Savings Accounts

Fixed Rate Savings (no early access)

Checkout even more more business savings deals here

With the Bank of England’s interest rate continuing to rise, Moneycomms research commissioned by TotallyMoney looks at the impact of an increase to 1% above its 2021 level of 0.1% on mortgage payments, using house price figures from HM Land Registry.

With the UK’s median loan-to-value (LTV) ratio at 73.46, the research is broken down by LTVs of 60%, 75%, 90% and by region, based on a 1% rate increase on a 25 year mortgage term. The full table, including breakdowns, can be found here:

https://www.totallymoney.com/interest-rate-rise-mortgages.pdf.

The average UK property costing £270,708 will see an annual increase in mortgage repayments of £1,188 on a 75% LTV mortgage with a 1% interest rate rise. This increases to £1,440 for those with a 90% LTV ratio and is £948 for a 60% LTV mortgage.

Unsurprisingly, Londoners would see the biggest increases to their mortgage repayments. With a 1% base rate increase, the average home costing £519,934 would see annual mortgage payments increase by £1,824, £2,292, £2,760 on respective 60%, 75%, and 90% LTV mortgages.

With 850,000 properties on tracker mortgages and 1.1 million on Standard Variable Rates, 1 in 4 UK households are already exposed to changes in the Bank of England’s base rate. Additionally, people looking to secure new deals will find that while the number of options are reducing, those still available are getting more expensive.

This comes as separate research from TotallyMoney and PwC shows that 8.9m adults exhibit signs of financial fragility¶. A group who has already had their income negatively impacted by the pandemic or to struggle to make repayments on their borrowing in the next year.

Alastair Douglas, CEO of TotallyMoney comments:

“As the Bank of England increases the base rate to ease inflationary pressures, the 2 million homes on variable-rate and tracker mortgages will see their household finances squeezed even more.

“And the situation isn’t going to get much better for those nearing the end of their current deals. They have a choice of facing the more expensive SVR or having to switch to a new, and more expensive fixed-rate product.

“Customers feeling the squeeze from the increased cost of living should consider cutting back on using expensive credit lines such as overdrafts, and move interest-bearing credit card balances to a 0% offer. By reducing the interest being paid, customers can repay their debts quicker, or use the money saved to cover other costs.

“At TotallyMoney we’re on a mission to help everyone move their finances forward. One way we’re doing this is by putting customers in control of their own financial data so that they can move towards a better financial future.”

Cifas has warned that fraudsters will cash in on our demand for debt as prices rise.

There were 360,000 fraud cases recorded on the National Fraud Database in 2021– back to pre-pandemic levels.

Identity fraud made up 63% of all cases – up 22% in 2021 – 91% of it was online.

24% of identity fraud victims are over the age of 61, with their cards and accounts a particular target

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, said: “The cost-of-living crisis will be boom time for fraudsters – and young people and older people will be particularly at risk. Cifas data shows fraud cases are back on the rise and no-one is safe as fraudsters target every aspect of our financial lives.

Scammers are shape shifters and change their tactics depending on the situation. They adopt increasingly sophisticated strategies to target victims. We are seeing a rise in credit cards being used fraudulently as well as loan products being targeted. In 2021 fraudulent attempts to access loan products was up 39% and while many of these were declined there are still a huge number of people impacted. Older people – aged over 61 are disproportionately affected by this kind of crime.

This is something that is only going to get worse as the cost-of-living crisis deepens and we are forced to use more credit and debt to meet our costs. At a time when so many people are already struggling the prospect of being scammed is another worry people just don’t need.

The rise in scam activity also means criminals need accounts to transfer funds from these scams, so we are also seeing the misuse of bank accounts on the rise – up 17%. Almost three-quarters (72%) of this is related to ‘mule activity’ where stolen funds are placed in people’s bank accounts before being transferred elsewhere. Young people have been particularly targeted, particularly those aged 21-30, but there has also been a rise in activity among the under 21s. Many of them are approached via social media.

Fraud can take a huge financial and mental toll on the victims and their families – not everyone is able to recover the funds stolen and this can have lasting impact. Increased awareness of this activity is vital if we are to protect ourselves from the scammers.”

New research published by used car buying service, ChooseMyCar.com, has revealed that over 90 per cent of drivers believe the Chancellor’s reduction on fuel duty has had zero impact on their fuel bill.

Spiralling fuel costs led Chancellor Rishi Sunak to cut the fuel duty by 5p a litre in a move that was widely welcomed. However, the new study suggests that it doesn’t go far enough, with an overwhelming majority stating it has done nothing to ease their fuel costs at a time when they need it most.

The statistics from the study showed that 92 per cent of 34-54-year-olds had seen no impact, and overall men were more likely to have seen no benefit, with 92 per cent stating no positive difference, compared to 88 per cent of women.

Geographically, there was also some variation in the impact of the cut, with a whopping 97 per cent of drivers in Northern Ireland stating that the reduction in duty had made no impact at all. The stats also showed that:

  • Belfast and Newcastle has seen the lowest impact on costs with 95% stating they had seen little or no difference on fuel costs in their area.
  • Leeds, Cardiff and Bristol weren’t far behind with 93%
  • Nottingham and Brighton were the cities which had seen the biggest positive impact on fuel prices, with a lower 85% and 86% respectively stating that costs had not been less.

Founder of ChooseMyCar.com Nick Zapolski said that it’s clear not enough has yet been done to help support UK drivers through spiralling costs and uncertain times.

“Recent research we conducted before this study showed that these increased prices meant many people were spending unacceptable levels of their disposable income on fuel.

“Sadly, our newest study shows that the Chancellor’s paltry 5p has had little to no impact on fuel costs for the vast majority of UK drivers. The time has come for more to be done to protect people from inflated costs and shortages over the coming months.”

Poor credit scores have deterred one in 10 Britons from applying for a mortgage, according to new research by The Mortgage Lender (TML).

The research also suggested evidence of a limited understanding of credit scores among the population. Nearly two-thirds (62%) of the 2,000 UK adults surveyed for the research said they did not know their credit score, with half (50%) of those who plan to buy a property in the next year unsure about their score.

In addition to not knowing their score, many were unsure how to improve it, nor did they appear to have much interest in doing so. Nearly two-thirds (60%) of respondents said they had never taken steps to improve their credit rating, while a further 13% said they weren’t clear of what steps they should be taking to improve their credit situation.

Fewer than one in five (18%) of those surveyed said they had taken steps to improve their credit score.

Peter Beaumont, CEO at The Mortgage Lender said: “The number of people who don’t know their credit score, despite wanting to make big purchases like buying a house, is a worrying trend. It shows there is a need for education among UK adults on what their credit score is, how it could impact major buying decisions such as home buying, and how to improve it.

“With house prices rising rapidly, it’s already a challenge for many buyers to either get on or move up the property ladder and understanding your credit score early on will help you to plan ahead and access finance when you need. “

The research also found that more than one in 10 (12%) of people who applied for a mortgage in the UK were denied, and a poor credit score could be the reason for this result.

Peter Beaumont continues: “With prices rising across the board, it can be tempting to take on too much debt but be wary of ‘too good to be true’ products and services. This will help to ensure you don’t take any unexpected hits to your credit score. Buy Now Pay Later products for example, can cause problems later down the line should you miss a repayment or pay late.

“In addition to the negative financial impact many have experienced due to the pandemic, people across the UK will be feeling an additional pinch in the coming weeks due to the rising cost of living. But a small blip on a credit score shouldn’t mean they are automatically excluded from a mortgage. Specialist lenders can support, where often the high street cannot, by offering products suitable for those with less than perfect credit scores. Talking to a mortgage broker will help to ensure you can find lenders that can help with your property ambitions.”

For those unsure about their credit score and how to improve it, there are some simple steps that can be taken. These include:

  • Registering on the electoral roll at your current address
  • Making regular payments like bills on time
  • Building your credit history by using – and then paying off on time – a credit card

According to new researchfrom wealth manager, Brewin Dolphin, 60% of British retirees have started accessing their pension pot without taking any advice from a financial adviser prior to retiring. Additionally, 78% of British people who have retired do not receive ongoing advice on how they can fully use their pension pot as they spend or draw it down. It is a worrying trend that could see savers and retirees make bad financial decisions at a crucial stage in their life, leading to negative consequences for their financial situation in retirement.

Richard Harwood, financial adviser at Brewin Dolphin, comments: “Retirement planning is a personal, complex, and confronting challenge which many people will struggle with, impacting their confidence to spend appropriately and fully enjoy retirement. These latest figures are increasingly concerning; retirees are dipping into their hard-earned savings without potentially thinking long-term and planning for the future. There is a real case of ‘longevity risk’, or the possibility that you will outlive your money.

“Speaking with a financial adviser helps mitigate this risk by providing a comprehensive plan and putting minds at ease. From navigating pensions and how to plan properly for your retirement, to manoeuvring changing personal circumstances and setting aside money for future generations, financial advisers have seen it all and can help. Financial advisers typically do the first meeting for free, and after that you’ll at least know if you’re roughly on the right track and what your options might be, so you can feel more comfortable with your decisions. Understanding what money you have for your retirement and how to spend it wisely is no mean feat, but that’s where preparation and speaking to an expert can be invaluable”.

[1] The research was conducted by Find Out Now in February 2022 through a survey of a thousand people aged between 55 and 75.

Which? is advising families facing cost of living pressures on how they can save money over the Easter holidays with these handy hacks for free, or cut-price, activities.

 

  1. Enjoy a meal out with ‘kids eat free’ offers
    When dining out as a family, it is worth checking if nearby restaurants offer discounts for children. Many restaurants and cafes run ‘kids eat free’ offers during the holidays. Which? found several popular chains offered discounts at certain times, including Yo! Sushi, The Real Greek and Morrisons Cafe.

  2. Visit a theme park for less
    Check the prices at attractions in advance, to save. For example, Which? found an adult day pass bought on the day at Alton Towers costs £62, but only £34 when bought in advance – a 45% saving.

Shoppers can also save money on days out at theme parks and attractions up and down the country when purchasing groceries at the supermarket. Which? found that some Carex handwashes have vouchers for half-price entry for Alton Towers, Chessington World of Adventures and Sea Life Centres and Sanctuaries valid until May 31 2022. Meanwhile, selected Kellogg’s cereal packs and snacks offer ‘adults go free’ vouchers for Merlin attractions valid until June 2022.

Tesco Clubcard holders can convert points into Tesco Reward Partners Vouchers, which can be used for as much as three times the saving at theme parks, wildlife parks and more.

  1. Learn something new at a free gallery or museum
    Many UK national galleries and museums are free to enter and are an easy way to entertain the family for a day out. Which? members highly rated: St. Fagans National Museum of History in Cardiff, Beamish: The Living Museum of the North in County Durham, National Railway Museum in York,  Royal Air Force Museum in Cosford, Shropshire and the National Museum of Scotland in Edinburgh. Just remember they may need visitors to book a free ticket before arrival.

  2. Burn off the Easter chocolate with some sport
    There are many free sporting activities available up and down the country during the holidays. It’s worth checking local council websites for opportunities, some offer free swimming lessons for children, for example. Alternatively, Parkruns are free weekly events, held every weekend in hundreds of locations around the UK. There are 5k events on Saturday mornings, and junior runs for children on Sundays. Tennis for Free also offers free tennis sessions for all ages in public parks around the country.

  3. Watch the latest movies at a discount
    Some cinema chains offer discounts for family films at certain times, usually in the morning. Odeon’s ‘Odeon Kids’, Picturehouse’s ‘Kid’s Club’, and Vue’s ‘Mini Mornings’ all offer discounts for both adults and children. For example, Vue ‘Mini Morning’ tickets cost £2.49 or £2.99 if you buy online (£3.49/£3.99 at the venue).
    Film fans can also get cinema discounts with dining cards Gourmet Society and Tastecard. Both offer up to 40% off some cinema chains and currently offer 90-day free trials.
    Anyone who buys a policy through the price comparison website Compare the Market will get 2 for 1 cinema tickets on a Tuesday or Wednesday for a year – those who may have bought a policy recently should check if this offer is available to them.
    It is also worth checking if your phone provider offers cinema discounts. O2 customers have access to O2 Priority and can often claim free Odeon tickets to use on Sundays and Mondays. Three Mobile customers can claim £3 adult cinema tickets for Cineworld or Picturehouse using the Three+rewards app and Vodafone customers can get two adult tickets for £7 at most Vue cinemas to use each week, using the My Vodafone app.

  4. Catch a theatre show for less
    Although usually an expensive outing, it is possible to bag cheaper theatre tickets. Local theatres often host touring West End productions for a fraction of the cost of London shows. Which? found tickets for The Book of Mormon in Leeds Grand Theatre starting at £15, while prices begin at £40 in London on the same date.
    Most theatres offer cheaper tickets for under 30s. For example, the National Theatre offers £5 tickets if you’re under 18, and £10 tickets if you’re under 26.

Every Monday at noon, a number of tickets for Disney shows (The Lion King/Frozen) are available for £25 through DisneyTickets and some shows, including Hamilton, run daily lotteries to enter, with winners able to purchase tickets for between £10-£35 for a performance that week.
Apps such as TodayTix can save visitors up to 66% on certain shows. Which? found tickets for Roald Dahl’s Matilda on Thursday 7 April for £25.

Often, seats at the back of the theatre cost less, but it is worth checking if the view is obstructed. Seatplan allows visitors to check out the view before purchasing tickets.

 

  1. Take the train to save on days out
    Some train companies offer cheap train travel for children travelling with an adult. For example, Southeastern, Chiltern Railways, London Northwestern and West Midlands Railway will allow up to four children (aged 5-15) to travel for £1 on a single or return journey when joined by an adult in off-peak times. Which? found an adult and two children could go from London to Margate and back on Southeastern services for under £30, with the children’s tickets costing £2. If two adults are travelling, they could save money with a railcard – the two together card costs £30 upfront but also saves a third on rail fares for a year.

    National Rail also offers 2 for 1 tickets at a range of attractions nationwide including Thorpe Park, Chessington World of Adventures and London Zoo when purchased with a train ticket.

  2. Take advantage of local libraries
    As well as borrowing physical books for free, most libraries allow users to borrow e-books and audiobooks. Some can also grant access to digital magazines and newspapers. Check local library offers via on the local council website and sign up for free.

  3. Explore the great outdoors
    Take advantage of the free parks up and down the country. Check out Which?’s guide on the best national parks in the UK. Alternatively, plan a walk using Which?’s guide to the best UK walks. Those in search of adventure could try geocaching tracking co-ordinates on a smartphone app to find hidden boxes known as ‘caches’. The National Trust has 10 places to try.

  4. Seek out free local events
    Many local councils offer free events during school holidays, so it is worth checking their websites. Search the local council’s name followed by ‘half-term activities’ to see what’s going on in that area. It is always worth checking out the local council’s website. For example, Which? saw that Manchester City Council will be running springtime craft sessions and Haringey Council in London will offer free Easter workshops for teens aged 11-16 in creative writing, drama and film.