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Britain cuts back on Christmas gifts as cost of living crisis bites

Gift Box,Gift Boxs
People are cutting back this Christmas as household incomes across Britain have suffered amid the biggest jump in prices in 40 years. Photo: Getty (krisanapong detraphiphat via Getty Images)

UK consumers are cutting back on Christmas gifts compared to the same time last year, as they rein in spending to combat the sharpest cost of living crisis in a century.

According to the Office for National Statistics (ONS) on Friday, six in 10 adults (60%) admitted that they were planning on reducing spending during the festive period by buying fewer and less expensive presents.

They also expect to eat out less thanks to reduced disposable income, the public opinions and social trends survey showed.

Household incomes across Britain have suffered amid the biggest jump in prices in 40 years. UK inflation reached 11.1% in October, before cooling slightly to 10.7% in November, more than five times the Bank of England's 2% target.

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The ONS said around 18% of people reported they had no savings to cushion rising costs, and that 7% said they had missed a bill payment in the past month.

The data was collected in the two weeks to 18 December.

Read more: Money new year resolutions: How to plan your finances for 2023

The survey also asked people about the important issues facing the UK today. The most commonly reported issues were the cost of living (93%), the NHS (81%), the economy (78%), and climate change and the environment (58%).

More than nine in 10 adults reported their cost of living had increased compared with a year ago, while 76% reported an increase in their cost of living compared with one month ago.

Meanwhile, a quarter of adults said they were occasionally, hardly ever, or never able to stay comfortably warm in their home over the past two weeks.

But there were signs that cost concerns are easing slightly among areas such as energy bills and rent and mortgage payments, which have remained relatively flat from the previous survey.

Read more: How to manage Christmas debts

The findings come as charities have reported a boom in sales with shoppers searching for second-hand Christmas gifts, suggesting people are more cash-conscious this year.

The British Heart Foundation reported its “biggest ever sales week” this December, while Barnardo’s, Age UK and Cancer Research all reported rising revenues at charity shops compared with the same period last year.

Watch: How to save money on a low income