High earners splashing out

Affluent Britons are upping their spending on luxuries such as travel, gourmet dining and sparkling wine as the cautious recession-era ‘lipstick effect’ fades away, an annual study has found.

Confident higher earners gave the holiday market a 6.5% boost last year to reach an estimated £39.9 billion.

Meanwhile, the leisure and entertainment market increased 3.7% to £30.22bn, according to analysts Mintel.

A “quality over quantity” mindset in relation to alcohol has also seen a 14% lift in volume sales of sparking wine to reach £1.3bn.

However, the beauty market, which enjoyed increased spending from the ‘lipstick effect’ as shoppers treated themselves with smaller ‘feelgood’ treats, suffered the first decline – of 0.2% – recorded by Mintel since it began collecting comparable data in 1999.

Mintel said “the twotrack recovery is still very much alive and kicking”, with almost four-in-10 of those with a household income of £50,000 or more saying they feel better off compared to a year ago, compared to just 16% of those with an income below £9,500.

“Whilst there has not been a big improvement in overall consumer confidence, better-off Britons are clearly pulling away from the rest,” it said.

Overall, the study found that total consumer spending reached £1,126bn last year, an increase of 1.7%.

One in four Britons (26%) say they are better off compared to a year ago, 53% say they are about the same and 20% say they are worse off.

Picture: PA. Affluent Britons are increasingly splashing out on luxuries.