HALF OF BRITS FEAR A FALL IN STANDARD OF LIVING

• Energy prices and cost-of-living crisis top list of financial concerns
• Women are more concerned about external factors, such as a recession, impacting their finances
• People plan to increase time spent reviewing their finances due to rising costs

Nearly half (46%) of UK adults are worried that their standard of living will fall over the next 12 months, reveals research conducted on behalf of Handelsbanken Wealth & Asset Management.  Concern was highest among those in their 30s (55%), dropping to 38% of over 50’s – likely due to accumulated savings.

 Despite recent declines, energy prices still top people’s biggest concerns on the factors threatening their living standard, along with the cost-of-living crisis and high prices caused by inflation.

 External risks worry women more

Women are more concerned than men about most external risks to their finances, including inflation (79% versus 72%), rising interest rates (59% versus 52%) and a recession (83% versus 73%). However, men worry more about geopolitical instability (57% versus 50% women) and stock market volatility (42% versus 37% women), with the latter perhaps due to being more inclined to invest, the research also revealed.

Divided on death and divorce

Men are more concerned about losing wealth through divorce (24% versus 19%), whereas women are more likely to fear the financial impact of their partner or spouse dying (47% versus 42%).

 Proportion of people concerned about various factors impacting their personal finances

Time invested

The study showed that these concerns are changing how much time we spend reviewing our finances each month.

On average, consumers spend over six hours a month on their finances, with groceries and other household costs taking up the most time (52 minutes) followed by bank account management (48 minutes), and paying for holidays (42 minutes). Wealthier people with assets over £100k spend longer keeping their financial house in order, averaging eight hours a month. Men, meanwhile, typically spend around 20% longer than women.

A tougher financial climate means we expect to spend more time managing our finances overall, largely in response to dealing with rising costs and stubborn inflation (48%) and the need to save more money (41%).

When it comes to those looking to decrease their time investment, nearly a third (29%) said they plan to reduce the time spent looking at their financial affairs as it makes them feel too anxious. This may go some way towards explaining the fact that a significant proportion of people don’t currently spend any time at all reviewing commitments such as their pensions (33%), insurance (31%) or investments (23%).

Alasdair Wild, Area Manager at Handelsbanken Wealth & Asset Management: “Dealing with the ongoing cost-of-living and keeping your finances in check can be a time-consuming process and a real challenge for most people given there only are so many hours in the day.  However, doing the bare minimum is unlikely to offer much protection in such a tough financial climate, and investing time to plan and manage your finances and, when required, bringing in external professional support, can make a real difference to protecting your standard of living. While avoiding the issue may provide temporary relief, it will only exacerbate problems down the line, so seeking support is key.”

Click here to view the full research report Gender and generation: unravelling the wealth gap.