It has been revealed today that an average family needs an income of £24,600 a year to have a basic standard of living as the cost of living has increased dramatically.
After calculating basic costs like rent or mortgage, travel and commuting, clothing utilities, insurance, mobile phones, motoring and groceries, reseachers came up with the figure for the average family.
The research was conducted by Andrew Barker, managing director of Skipton Financial Services, he said; “It’s frightening how everything adds up”.
“The cost of living is astronomical and now more than ever people have to be on the ball with their expenditure and to keep on top of things, particularly at a time where inflation is riding well above target at five per cent.”
“Inflation continues to hit families hard with the rising prices of food, petrol and energy bills.”
“It is not surprising mortgage interest is the number one spend, even though interest rates are at rock bottom levels.”
The study of 2,000 households revealed that the biggest single cost is mortgage repayments – totalling £4,730 a year, the weekly grocery shop for food totals £4,457.
Of those questioned, only 40% admitted to having a savings account, putting an average of £86 into the account per month.
Andrew Barker continued: “Don’t forget that our research showed households need to actually bring home £24,600 to break even.”
“To bring home this figure, once income tax and national insurance has been taken into account, a basic rate taxpayer would actually have to earn £32,702.
“With many sectors currently suffering a pay freeze, it is difficult to increase your monthly incomings so it is even more important to be ahead of the game with your expenditure. Get your bank statements and check all direct debits and standing orders.”
If you are struggling to pay your bills and debts visit www.humberdebt.co.uk for for debt management advice.
Humber Debt Solutions are based in Hull but help people nationwide. Call today on 0800 915 5371.