How Brits manage their wages and payday spending
Managing your wages after payday is an important part of budgeting.
But for many Brits, making wages last for the whole month can be a real struggle. Lowell recently conducted new research into people’s spending habits, to find out how Brits manage their money come payday, to help us better understand how we can help our customers with budgeting.
Our research revealed that 12% of Brits spend up to 30% of their wages in the first week following payday. While that might mean that some people go on a spending spree after payday, we understand that for some of our customers, wages don’t last long after payday because you’re covering essentials like bills and groceries. While it’s nice to think about the different ways you might be able to build up a savings pot one day, it’s important to make sure you have enough to cover other essentials for the rest of the month first.
If you’re in this kind of situation, you might find tools like our budget calculator helpful. If you’re feeling worried or stressed about managing payments because your circumstances have changed, check out our Next Steps page to see how Lowell can work with you if you’re going through a tricky time.
48% of Brits spend their wages and rely on credit once a year
Our research also revealed that 48% of Brits spend all their wages and depend on credit at least once a year. Depending on credit can cause problems with debt if you’re unable to keep up with payments, which can cause additional financial stress. If you find you’re struggling with budgeting across the month and relying on credit, then check out resources like our blog on how to budget.
Almost a quarter of Brits don’t put any of their wages into savings
Another fact from our survey revealed that almost a quarter (24%) of Brits put 0% of their wages into savings. When you’re living paycheck to paycheck, it can be hard to build up your savings. You can use our budget calculator to work out how much you can afford to pay and save each month.
If you’re unable to save anything once all of your important bills have been paid, then one of your eventual financial goals might be to build up a safety net in case of an emergency. If you’re struggling to figure out how to make your wage stretch to cover an emergency fund, check out our guide on how you can build a financial safety net.
The cities with the fastest spenders
Our research also highlighted the ways in which spending habits vary across the UK. When it comes to spending their wages quickly, Leeds took the top spot. The West Yorkshire city is the fastest place in the UK to spend wages after payday, with the average person spending more than half (51%) of their wage within the first week of payday.
This was followed closely behind by Norwich, where residents had spent an average of 49% of their wage within the first week, and then Glasgow (48%) closely followed with Yorkshire and the Humber (47%) and Liverpool (46%) also making the top five.
Out of all the UK cities, Brighton spent the least, with the average person spending 39% of their wage within the first week of receiving it.
If you’re struggling with budgeting or working out how much of your paycheck you can afford to put towards paying off a debt that’s owned by Lowell, get in touch and we’ll discuss how we can help. And for more help with debt and finance, check out our debt guidance hub or head to the Lowell blog.
Published by Libby Davies on 24th September 2021