Are you feeling the pinch of rising living costs? If so, you’re not alone. The cost-of-living crisis is hitting households across the UK, with prices for essential goods and services skyrocketing and wages struggling to keep up.
From rising energy bills to increasing food prices, many families are finding it harder and harder to make ends meet. But how long will this crisis last? And what can we do to weather the storm?
In this blog, we’ll explore the causes and consequences of the cost of living crisis and examine what the UK government is doing to help.
The cost-of-living crisis has been hitting UK households hard over the past few months, with the rising cost of essential goods and services eating away at people’s disposable income. From rising food prices to increases in energy bills, the cost-of-living crisis is affecting people from all walks of life, and many are wondering how long it will last.
The cost-of-living crisis is when the cost of essential goods and services is increasing faster than wages and salaries. This means that people are having to spend more and more of their income on basic necessities, leaving them with less money for discretionary spending.
The cost-of-living crisis is having a significant impact on UK households, particularly those on lower incomes. According to research by the Joseph Rowntree Foundation, over 14 million people in the UK live in poverty, and rising living costs make it even harder for them to make ends meet. Many families are having to cut back on essentials like food and heating, while others are being forced into debt to cover their basic living expenses.
The cost-of-living crisis is continuing to impact people. Even though household incomes are rising again, people are still feeling the pinch financially. In response to the emergence of the cost-of-living crisis, the Government introduced lots of support 👇.
Despite these measures, challenges persist. The UK economy is facing a moderate recession in 2024, with no immediate prospect for tax cuts or increased public spending. The energy crisis has been largely brought under control, with the Energy Price Cap expected to fall further, reflecting recent drops in wholesale energy prices. However, energy costs remain significantly above pre-pandemic levels.
While the UK government has introduced various measures to mitigate the impact of the cost-of-living crisis, many households continue to face financial challenges. The situation is gradually improving, but it remains a complex issue requiring ongoing attention and support.
Inflation is the rate at which prices for goods and services increase. When inflation is high, it means that the cost of living is rising faster than wages and salaries, leading to a decrease in people’s purchasing power.
Inflation, a key factor in the cost-of-living crisis, is still rising. Inflation is at around 2.2% as of mid-2024 (ONS). This high rate has continued to keep the cost of goods and services elevated, straining many households. Contributing factors include rising oil prices and a weakening job market, although there has been some positive news with average wage growth outpacing inflation for the first time in two years.
In these challenging times, managing finances wisely is crucial. If you currently have a car on finance, have you thought about refinancing? Refinancing offers flexibility – you could downgrade to a smaller, more affordable vehicle, or simply spread the cost of your current car to reduce your monthly payments.
The best part? Applying is quick, easy, and won’t affect your credit score. It takes just 30 seconds to apply, and you’ll find out if you’re approved on the same day. Don’t let financial stress weigh you down.
Find out how refinancing can help you navigate the cost of living crisis.