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Coronavirus: 4.7 million Brits use lockdown to save and cut debt

Abigail Fenton
·2-min read
Brits are saving almost £30 extra each week in lockdown. (Gareth Fuller/PA Wire/PA Images)
Brits are saving almost £30 extra each week in lockdown. (Gareth Fuller/PA)

With the government encouraging the nation to stay home, 4.7 million Brits have used the time to socially distance themselves from their debt, according to a new study.

A survey of over 2,000 UK adults by savings site VoucherCodes found fewer people are currenly in debt than prior to social distancing measures being introduced.

Excluding mortgages, those who are currently in debt dropped from 50% to 41%, equating to 4.7 million fewer Brits.

Despite news of holidays being cancelled and restaurants and bars closing their doors, 2.5 million people say they actually feel happy they can use lockdown to repay — fully or partially — their existing debt.

READ MORE: Coronavirus — UK national debt nears £2tn for first time

Since lockdown began on 23 March, nearly half of Brits (47%) said that they save more each week — £27.30 on average, equating to £109.20 per month.

Additionally, over half (58%) of people are saving up to £200 more per month, while 8% are saving £400 and over.

Meanwhile, the latest Bank of England figures show Brits paid off a record £7.4bn of debt in April during lockdown.

READ MORE: Coronavirus: UK energy firms still using debt collectors despite COVID-19 pandemic

While these extra savings have led to 15% of people feeling positive about their current financial situation, two in five admitted to feeling anxious about their finances.

For those who have been made redundant in the past month, this figure is much higher at 54%. A similar picture emerges among those who are currently furloughed, of whom 49% said they had anxieties about their finances.

Anita Naik, lifestyle editor at VoucherCodes said: “While social distancing measures have drastically changed life as we know it, it’s encouraging to see that many people are actually seeing an improvement in their financial situation as a result.

READ MORE: Coronavirus could create £105bn debt black hole for smaller UK firms

“Whether that’s saving an extra £50 a week or taking this opportunity to pay back any existing debt, it’s great to see a positive change in people's attitudes towards their finances.

She added: “The decline in the number of people who are in debt since lockdown measures came into place is also promising.

“If you’re looking for achievable ways to save money during this time, simple ways to start include setting a weekly budget, and cancelling any subscriptions you no longer need.

“Finally, by being conscious to shop around and make use of discounts, you’ll be sure to get the best deals available, and the little savings will quickly add up.”