The Cost of Living Crisis: UK Survival Guide
Households across the UK are struggling to cope with the cost of living. With news that inflation has risen to 9% - the highest level in 40 years – people are facing a dismal run of price hikes, which will hugely affect their monthly expenditure. A cost of living crisis, UK households, is nothing new for a large portion of the country’s population, but the squeeze is now affecting more families, and hitting those in financial hardship even harder.
The outlook may look fairly bleak, but there are measures you can take to help survive the UK cost of living crisis and come out the other side with money management techniques! Continue reading to learn what has caused the cost of living crises and tips you can follow to ease pressure on your shoulders.
What is the Cost of Living Crisis?
Before you can start using money management tips, you need to understand the current climate, so here is the cost of living crisis explained. At the time of writing, the UK’s inflation rate is at a 40-year high, which has left plenty of the country’s population feeling the pinch.
The cost of living UK crisis represents a drop in disposable income for households due to rising energy and fuel costs, as well as supermarket prices. With inflation rising and salaries failing to match it, coupled with recent tax increases, it is becoming harder for families and individuals to cope with the cost of everyday living.
Why is there a Cost of Living Crisis?
There are a range of contributing factors to the current cost of living crisis. UK households may have read reports that the situation has been caused by the war in Ukraine, but there are other elements that need to be considered, such as:
- Covid – The country’s economic health was severely damaged during the pandemic, with the transport, hospitality, leisure, and entertainment industries being heavily affected. Due to this, as well as the government’s multi-billion-pound furlough fund, the UK was in a delicate state. Industries have since reopened and are now trying to recoup their losses
- Collapsed energy suppliers – A host of UK energy suppliers have gone bust over the last few months, which has directly affected the cost of household bills
- Weather – With parts of the world experiencing a bitterly cold winter in 2020 and 2021, the prices of energy went through the roof to match the demand for supply
The following issues are also legitimate contributors to the UK cost of living crises:
- Environmental issues
- Supply chains
- Commodity prices
How to Survive the UK Cost of Living Crisis
If the rising cost of living is affecting your circumstances and you’re desperate to find ways to ease the financial pressure off your shoulders, then check out our tips for dealing with the UK cost of living crisis.
Cancel Any Unused Subscriptions
With it being so easy these days to sign up to subscriptions on our phones, it can be easy to lose track of what we’re actually using. If there are certain services you’re paying for but don’t use that often. For example, do you have three or more streaming platforms but only use one or two? Cancelling a few small subscriptions could help you in the long run.
Do you pay for a gym membership monthly? Can you count on one hand the amount of times you’ve visited the gym since you enrolled? Perhaps it’s best to cancel it and save you some money! There are bigger issues happening in the cost of living UK crisis, but taking this action will free up some much-needed money in your pocket.
Shop Around for Cheaper Insurance Deals
One way of coping during the UK cost of living crisis is finding cheaper insurance deals. Most adults will take out a series of different insurance packages over the course of their lifetime, including:
- Car insurance
- Home insurance
- Contents insurance
When you add up the annual cost of your various insurance payments, the figure can be eyewatering. Given the cost of living crises, UK residents can reduce these payments by shopping around for cheaper insurance deals. Get on comparison websites to find the best option available to you.
Move Your Credit Card Balance to Stop Paying Interest
Many people who have credit cards will pay it back each month without even thinking that there are options for them to stop paying interest. Typically, credit card interest sits at 20% APR, which is added on top of your monthly repayments.
One of our UK cost of living crisis tips is to find a card provider who will take on up to 95% of your allocated credit limit on a 0% balance transfer card.
A lot of us tend to stick to the same supermarket as part of our routine, but this global cost of living crisis is affecting the price of supermarket goods. Given how essential it is for families and individuals to put food on the table, it is worth taking some time to compare prices between supermarkets. Also, don’t forget that most supermarkets offer deals and rewards, so take advantage!
Reduce Your Personal Spending Without Hugely Affecting Your Lifestyle
To survive the cost of living crisis, UK residents should look at their own individual spending. Our monthly expenditure tends to be a combination of:
- Mortgage payments/Rent payments
- Household items, such as toiletries, cleaning products etc
- Non-essential items, such as entertainment and technology
With the cost of living crisis explained, you may want to cut down on non-essential items. For example, instead of buying food for your lunch at work, bring your own from home. Also, while at home, you can reduce your energy usage by turning off the lights in rooms you’re not in and hanging washing rather than using a tumble dryer.
This doesn’t mean that you have to stop enjoying your life! The odd treat here and there is harmless, it’s just in these trying times you have to be more mindful over what you’re spending.
Develop Money Management Skills
The cost of living UK crisis is hitting everyone hard, so the tips above should go a long way to helping you live more securely. If you want to boost your knowledge even further, consider enrolling on an online course with learndirect.
As the UK’s leading online learning provider, we have helped more than 4 million learners gain various qualifications, and now we want to help you expand your understanding of money management.
Managing your money is not easy, but the below online courses will give you some extra help when it comes to finding some financial security during the UK cost of living crisis.
Personal Money Management
Gain a solid understanding of how to plan and review your finances, and learn how to plan for your short-term and long-term goals. When studying this Personal Money Management course, you will explore the following modules:
- Identify personal finances
- Manage your own money
- Planning your money for a significant expenditure
By completing this online course, you will be able to apply these teachings to your everyday spending, alleviating the pressure on your shoulders during the UK cost of living crisis.
This money management course can be completed from the comfort of your own home, and you can make your way through the modules at your own pace. Upon completion of the course, you will be confident in managing your money.
Debt Management Skills
It is normal for adults to get into some form of debt, such as credit card debt, but if you can manage it, it won’t put a huge dent in your disposable income. For those who struggle to do this, it can be a slippery slope, which is even more of a danger during the cost of living crisis. UK residents can learn how to manage this by enrolling on our Debt Management Skills course.
Not only will the online course help you manage your own money, but it could also guide you into a new career role, such as a Financial Planner. This is because you will cover the following modules:
- What is Debt?
- The Problem with Debt
- The Difference Between Good and Bad Debt
- Identifying Your Debts
- Putting Debt into Context
- Crisis Management
- Increasing Your Income
- Reducing Your Outgoings
- Establishing a Debt Management Plan
- Reducing the Risk of Future Problems
- Helping Others with Debt Issues
This debt money management course is delivered 100% online, so you have the freedom of making your way through it at a pace that fits around your day-to-day schedule.
We Can Help You Through the Cost of Living Crisis, UK Households
With the cost of living crisis explained, you can now start implementing the tips we have given you so that you and your loved ones can live more comfortably during this difficult time. We here at learndirect are also making a conscious effort to support those experiencing challenging times.
Our pledge to learners is that if they fall into trying circumstances, they can swap their course, take a payment holiday, benefit from a job support package, and speak to our trusted community of advisors.