1 in 3 adults in the UK are struggling with mortgage or rent payments. The same number of people are cutting back on non-essential journeys to save money on fuel.
Inflation is sitting at a 30-year high of 9.2%. Food and non-alcoholic drinks are at a 45-year high, with vegetables having risen in cost by a staggering 18% in the first 2 months of 2023. Retail sales are down 3.5% from this time last year despite a slight increase in discount store sales.
Perhaps the most hard-hitting increases are in energy, with electricity having risen a shocking 66.7% in the 12 months preceding February 2023. As alarming as that rise is, it is dwarfed by the hike in gas costs which increased by 129.4% over the same period.
1 in 5 adults reported being unable to afford to keep their house warm enough for their comfort this past winter. Half of all adults have had to cut back on household fuel consumption for budgetary reasons.
Brits are struggling. And the government figures are motivating people to take action.
Statistics published on the .gov website for the Office for National Statistics (ONS) have alarmed Brits and motivated them to change their habits and behavior.
With real-term wages falling by an average 2.4%, Brits are making budgetary choices to minimize the effect on their quality of life.
Luxury expenses are the first to be adjusted. People are eating out less, and/or in less expensive places. 42% said they will stop dining out altogether. 50% will no longer treat themselves to takeaways.
People are buying less expensive clothes, or sticking with their favorite brands, but buying less often.
Then there are holidays. Before the pandemic, the average British family was spending up to a quarter of their annual salary on their holiday.
Cutting back on vacation budgets
Vacations are one area where people are cutting down on expenditure. Brits want their holidays, but they are inventively finding ways to make them more cost effective: More people are taking 1 holiday instead of 2. People who used to take 3 holidays are cutting back to 2.
Less people are taking long-haul flights. They are choosing better value destinations and almost 18% more people are choosing to remain in the UK.
Holidays are a significant outlay for most people. So flexibility is absolutely key to intelligent budget management.
Timeshare owners lack flexibility
Timeshare owners generally own a number of weeks or points that they estimated would cover their annual holiday requirements at the time of purchase. They are contractually obligated to pay the annual costs for the amount of timeshare they own, regardless of whether they actually go on holiday.
Those annual costs are often around the same cost as non-owners pay for equivalent standard accommodation. Non owners can even book to stay in the timeshare complexes themselves via booking sites.
The annual fees are increased at the whim of the timeshare companies, and no matter how great the increase, the member has no option but to pay.
If owners want to go anywhere else, or at a different time of year, that comes at an extra cost. Unlike ordinary holidaymakers they can’t choose to go on holiday less often, or to a lower grade of hotel to save money.
The exchange systems touted by timeshare sales staff as being the key to unlimited, worldwide luxury holidays rarely work. Members report rarely being able to access their preferred destination or time slot. Even when they do make their choice there are appreciable extra costs involved with making an exchange.