How Britain is coping with tighter finances

The fact that Britain is facing a period of financial restriction can hardly escape our attention. We’re really feeling the pinch, increasingly looking for ways to stay comfortable while taking into account the reasons why finances are tight.

Why are finances tight?

The main cause of restricted finances for the average household is quite simply that prices have gone up whilst incomes have not. This means households are left with bills which they can’t pay.

In terms of income, whilst some Brits have experienced a pay freeze others have seen a reduction in the amount of money entering their home. This is most commonly caused by a reduction in working hours, a generalised pay-cut or even unemployment and redundancy. It has been reported that as many as 2.67 million people were unemployed in the UK, at the end of 2011, according to figures from the BBC.

According to the Office for National Statistics (ONS) this means the UK’s unemployment rate has risen by 8.4%, putting the number of people out of work at the highest level in sixteen years.

How are Brits coping?

In order to address the situation, Brits are turning to a number of solutions. Whilst some are sacrificing luxuries others are looking for ways to keep costs low – such as using basic amenities more efficiently and buying discounted goods.

Unfortunately, the situation has even prompted some individuals to sacrifice basic comforts and essentials – leaving them vulnerable. The winter months of 2011 saw energy prices increase across the board with gas rising by an average of 17% and electricity by an average of 10%. This situation put such a strain on finances that some elderly Brits resorted to turning their heating off, despite the freezing temperatures outdoors. The act has some similarities with a report in The Daily Mail from 2010, which revealed nine pensioners had died every hour during the winter of 2009 as soaring bills made them neglect their heating. Such figures left the UK with a reputation for having the highest winter death rate in Northern Europe.

For those who are not prepared to put themselves at risk in this manner, there are of course other ways in which to manage the current economic climate. Short term loans are one example – giving people access to the vital funds they need as and when they need it.
These loans can be paid back easily and the credit checks, whilst still conducted, are often less stringent than those for other loans, make these solutions available to a wider selection of people. This helps to ensure no-one is forced to make sacrifices over basic amenities in an attempt to save money and even £500 loans can be obtained for those who just need a small cash injection.