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One in three plan to leave lockdown savings untouched – survey

Vicky Shaw, PA Personal Finance Correspondent
·3-min read

A third of people who have managed to build savings during the coronavirus pandemic do not plan to spend any of this cash as restrictions are eased, according to a financial confidence survey.

Just over half (56%) of people have managed to save during the lockdowns, comparethemarket.com’s household financial confidence tracker found.

Some 33% of people plan to sit on the money they have put away rather than spend it, and the same proportion say they are planning to spend less than half of the money they have set aside.

Lockdowns
Some 19% of people surveyed said they would get their hair cut professionally less frequently in the future (Ben Birchall/PA)

Some 31% will put their spare cash towards holidays, while 18% will look to spend in pubs, cafes and restaurants.

The survey, carried out in early April, also asked people which activities they will do less often in future than they did before the coronavirus pandemic, as restrictions are gradually eased at different rates across the UK.

More than a third (35%) of people expect to eat out less often, 32% will board flights less frequently, 24% will indulge in “retail therapy” less, 19% will get their hair cut professionally less frequently, 17% will drive less often and 9% will be less inclined to join a gym, the research found.

Many people have already looked to cut their outgoings.

More than half (55%) have tried to save money on household bills and subscriptions, 29% have changed a household bill provider to get a cheaper deal, and 34% have switched their regular food shop to a cheaper supermarket, the research found.

Ursula Gibbs, director at comparethemarket.com, said: “We are seeing a significant reset in the way that people think about their personal finances in the wake of Covid-19.

“The past year has been extremely tough on household budgets and really underlined the value of rainy-day funds, with our research suggesting this has helped kick-start a savings culture.

“As people have driven and shopped less, cooked at home, and found ways of exercising that didn’t involve going to the gym, it seems that many want to carry on some of the financial benefits of the lockdown lifestyle.”

The survey of more than 2,000 people across the UK also found that nearly three in five (61%) adults are not confident that current national lockdown restrictions will be the last.

Nearly one in 10 are worried that members of their family could be furloughed, made redundant or see their income fall in the coming months.

Over half (52%) of families with children at home believe the pandemic will have a long-term negative impact on their finances, compared with a third (34%) of those without children at home.

A quarter (25%) of families with children anticipate it could take up to a year to get back on track financially, and just over one in 10 (11%) expect to have to cut back or make financial sacrifices for several years after the lockdown ends.

Nearly a third (29%) of families with children at home have made use of some sort of payment holiday since the pandemic began, compared with 12% of households without children. The deadline to apply for many payment exemptions ended in March.

Around two-thirds (67%) of parents with children are worried about their ability to pay household bills in the future.

Ms Gibbs added: “The good news is that many people have used the pandemic to take control of their money, reviewing household bills and making savings where they can, to ensure that they are on a strong financial footing.”