Understanding Average UK Household Spending
It is a fact that life in the UK is expensive. But have you ever wondered just how expensive it can be?
In this article we shed light upon average household spending in the UK. In most cases, household expenses are divided into three main categories which are:
- Housing and household expenditures
- Transportation costs
- Food costs & miscellaneous expenses
Average Household Budget in the UK
Before we discuss the individual categories, let’s first understand how much families in the UK are usually willing to spend for their household expenses. The average household income for most people in the UK was around £27,300 in 2016, according to a report published by the Office of National Statistics (ONS).
According to information from the same report, the British spend most of this income on necessities such as transportation, housing, and food. Actually, most of their income goes into transportation, which accounts for 14% of their total household budgets (which is £528 per week) while 11% goes to rent/mortgage interest and 10% for buying food and groceries.
To further understand the breakdown, let’s study the each of the categories individually.
1. Housing and Household Expenditures
A British family spends around £10,800 per year on average on household expenses. This includes an average of approximately £4,500 spent in the form of direct payments for rent, mortgage interest, insurances, and council taxes. The residual £6,300 help cover up other associated expenses such as utilities and additional household equipment as well as maintenance costs. This amount also helps to pay for household goods & services for example furniture, furnishings, appliances etc.
Many people struggle to fulfil their expenses in the household expenditure category and resort to applying for bad credit short-term loans to make ends meet. With the meagre annual earnings of £27,300, many people have no option except to opt for bad credit short-term loans to ensure that they can pay for their rent/mortgage interests without making their family suffer or struggle financially otherwise.
2. Transportation Costs
Transportation in the UK is the most expensive in the world which is why it only makes sense why such large amounts of money are spent on transportation. The British spend an average of £4,763 annually in the name of transportation. This amount is £263 more than what they spend on housing and other household expenses every year.
For people who own their own vehicles, over £1,100 are spent on fuel for personal vehicles and £562 as vehicle insurance while those relying on public transport spend about £348 on transport fares.
3. Food & Other Costs
The third most expensive household budget category is food including groceries. On average, a UK household spends almost £3,150 every year on groceries and other food supplies. An additional £450 is spent on alcoholic drinks whereas eating out takes up to £2,020 annually. Therefore, in total, food and drinks take up around 19% of our total yearly household financial plans.
So, this is what an average household annual expense sheet looks like in terms of housing, household, transportation, and food expenses. For many, surviving on an annual income of £27,300 is practically impossible which is why many British families depend on bad credit short term loans. These help them with other additional costs and unplanned expenses, which they later repay easily in the form of small instalments. If you, too, are looking towards saving up, you might want to focus more on where you think you are spending unnecessarily and try to save more in that category.