UK turning to loans to fund life events
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AS THE cost of living continues to rise, worrying research has revealed that one-in-five Brits are turning to loans to attend key life events, including weddings, while more than a quarter rely on credit cards.
The study of 2,000 British adults was commissioned by Forbes Advisor via OnePoll.
The findings are part of a study conducted by the leading price comparison platform, outlining how the British public funds various events and celebrations during their lifetime.
A further 26 per cent of Brits said they would have to cut back on gift giving and event attendance due to the rising cost of living, while one-in-eight admitted they can no longer afford to attend celebrations.
The review comes as National insurance is also rising by 1.25 per cent, which has put a further squeeze on family spending, with employees, employers and the self-employed all paying 1.25p more in the pound for National Insurance (NI) from April 6.
Government website Gov.uk says your National Insurance contributions might increase when the Health and Social Care Levy comes into effect in the UK (England, Scotland, Wales and Northern Ireland) from April 6.
The increase in your contributions will be used to help fund the NHS, health and social care.
You will not be affected by these changes if you’re above State Pension age
and are not an employee or self-employed.
To help ease the pressure, the threshold will increase from July so that you don’t have to pay if you earn less than £12,570.
From April 2023, National Insurance will return to its current rate.
In the next 12 months, anyone earning less than about £34,000 will pay less National Insurance than they did last year and anybody earning more than that will pay more.
The proposal is predicted to raise £12 billion annually.
In the face of rising costs, worryingly, 11 per cent are reverting to expensive payday loans to raise funds, while more than a quarter (26 per cent) rely on credit cards.
More than one in 10 (12 per cent) Brits say they turn to family or friends for money to cover the cost of life events.
The study, conducted by Forbes Advisor, follows months of rising living costs, as UK inflation reaches a 30year high of 5.5 per cent.
Over a quarter of those surveyed (26 per cent) say they would have to cut back on gift giving or spend less
on attending significant life events due to the rising cost of energy, fuel and food. One in eight (13 per cent) say rising living costs means they can no longer afford to buy gifts or attend celebrations.
The study also listed the most expensive celebrations that Brits attend as guests throughout their lives, based on the average cost of both attending and providing a gift:
Family wedding - £235 l
Hen/stag party - £199 l
Friend’s wedding - £199 l
Graduation - £189 l
Baby shower - £165 l
Engagement party - £159 l
Anniversary party - £156 l
Naming ceremony - £154 l
Adult birthday l party - £142
Housewarming - £138 l
Personal finance expert at Forbes Advisor, Laura Howard, said: “The end of Covid-related restrictions on international travel, guest numbers at events such as weddings, self-isolation and mask wearing, is a massive breath of fresh air as we head towards a brighter spring and summer of 2022.
“Yet, as we come out of one crisis, the weight bears down heavier on another
– the soaring cost of living. Of course, this is in no way comparable to the suffering that millions of Ukrainians fleeing their homes as a result of the war are facing right now. But, for those of us on UK soil it’s the kind of worry that can keep us awake at night.”
She added: “We have little choice but to power our homes, fill up our cars with fuel, and do the weekly food shop – all costs which have soared since the pandemic began. But for more and more households, this is simply where the money runs out and ‘extras’ such as life celebrations become unaffordable.
“Cutting back on expenses is no easy feat, especially now when cheap energy deals are no longer available. But it’s worth seeing if there are some unnecessary expenses to tackle.
For more visit https://www. forbes.com/uk/advisor/loans/ best-ways-to-borrow site.