Many adults have cut back significantly on non-essential spending

The annual poll of 2,000 adults found that despite persistent cost of living challenges, 53 per cent have either achieved or made significant progress towards their financial goals this year.

To do this, 40 per cent have spent less on non-essentials, while others have gone out less (35 per cent), budgeted (31 per cent), aimed to save more (27 per cent), and sold unwanted items (25 per cent).

This saw monthly spending on takeaways fall by 47 per cent over the last year, from £85.26 in 2022 to £45.08. Money spent on nights out tumbled by 34 per cent, from £82.34 to £54.23.

Mobile phone bills have been cut by more than half, with the average spend now just below £50 as consumers seek better deals.

Meanwhile, non-essential purchases of clothes and home furnishings were also reduced by savvy savers by more than 30 per cent, from an average of £102.62 a month to £70.76.

It also emerged there has been a 42 per cent decline in the number of people living paycheque to paycheque over the last year, with 17 per cent doing so in 2023 compared to 30 per cent in 2022.

The research found 34 per cent have been motivated by the cost-of-living crisis to become more financially resilient, with 27 per cent taking greater control of their finances as a result, while 19 per cent made a budget for the first time this year.

Brian Byrnes, head of personal finance at Moneybox, which commissioned the research, said: “2023 has been another challenging year for many people across the UK with continued cost of living pressures. Yet, our latest research paints a hopeful picture. We can see the significant lengths many people have gone to in order to make progress towards their goals, doing what they can to control their outgoings as well as prioritising saving for the future.

“There are helpful rules of thumb when it comes to our spending, such as allocating 50 per cent of our income to our needs (e.g. rent and bills), 30 per cent towards discretionary spending and 20 per cent towards our savings. When inflation is high, discretionary spending can be hard to track but Brits have shown admirable control in this area, and as such have been able to make progress towards their financial goals in tough financial conditions.”

Starting the year right

As we head into a new year, the research, carried out via OnePoll revealed that achieving financial goals is a high priority for 54 per cent, compared to other more ‘traditional’ resolutions like health and fitness or learning new skills. The most popular financial resolution is to build up a rainy-day fund (31 per cent) followed by investing (18 per cent), regularly making a budget (16 per cent), paying down debt (16 per cent) and saving to go travelling (16 per cent).

However, 28 per cent have not set any financial goals for the coming year.

Moneybox’s Brian Byrnes added: “Taking the time in January to set goals can help put you on the right path for the rest of the year. As a former financial adviser, I have seen first-hand the benefits that can be gained from making and regularly reviewing a plan for your finances to help you achieve your short and longer-term goals.

“While it can be easy to set financial resolutions, sticking with them can be a challenge, so it’s important to ensure that goals are both realistic and achievable. I would recommend setting calendar reminders every three months to check your progress. 

"Celebrate your achievements and adjust your goals as needed. There will always be unforeseen events that can take us off course but keeping the end goal in mind is the best way to ensure you’re always moving in the right direction.”

Non-essential spends

Monthly spend                                                2022                                    2023

Nights out                                                      £82.34                             £54.23

Mobile phone                                                 £95.35                               £46.65

Takeaways                                                   £85.26                             £45.08  

Other non-essential items                          £102.62                    £70.76

Total                                                                £365.57                             £216.72