As the United Kingdom enters the 7th week of the lockdown, announced nationally on March 23rd 2020, it appears that some of the stringent conditions imposed by the Prime Minister are about to be lifted. United Kingdom loans analysed the past seven weeks in terms of the financial impact on households, and there have been some interesting findings about what impact the coronavirus has had on personal income and how savings have been made in many households as a consequence of the health pandemic.
In the last seven weeks, residents of the United Kingdom have not been able to leave the property on more than one occasion. At United Kingdom Loans, we have had some interesting discussions about what this means, specifically, how long we can remain out and who we can see when we are out. We have also been unable to visit our nearest and dearest; although some of these rules have recently been relaxed, there remains some confusion around who you can see when you leave your home. Shopping for essential items on one visit per household has also been part of the arrangements for UK residents since March 23, and it appears that, based on the statistics provided by the government, there has been a potentially positive impact on the nation’s health as a consequence of the restrictions, although we are not out of the woods yet!
Personal Finances and Covid-19
But how has Covid-19 impacted personal finances, and have there been any benefits when considering income as a consequence of the coronavirus? Many people have argued they had to remain within their homes for extended periods, which has lowered the amount of money people have spent compared to how much they would have spent before the national lockdown. A closer look at this would prove this point; fuel costs are examples of where money has been saved. Many people have been encouraged to work from home, and this flexibility has afforded a more productive nation of workers within the United Kingdom, who have not needed to rely upon their vehicles as much as they previously did. Because of this, the cost of forking out large quantities of fuel to travel across the country has lowered, leading to significant savings. Another significant financial saving has been the reduced use of public transport when considering transport. As many people can now work from home, there has been less need for people to use trains and buses, which can accrue a significant sum of money. It can therefore be argued that significant sums of money have been saved due to people taking advantage of working-from-home arrangements.
Savings Through the Lockdown
Lots of people within the United Kingdom are also turning to home-cooked food as opposed to buying precooked purchased processed food. In terms of finances, this has culminated in significant savings and, indeed, a healthier option for many people! Similarly, some people are now more focused when they shop, and there has been an increase in the usage of shopping scanning apps, which has also culminated in savings for the British household. We have had discussions at United Kingdom Loans quick loan HQ around our shopping habits, and the consensus was that we have all saved money by focusing on our shopping habits.
Whereas previously, whilst working away from your property, there would be additional spending for items such as lunch, snacks, coffee, and other non-essential items we tend to turn to when working away from the family home. Because of the lockdown, many of us have in fact saved money by not needing to fork out small but significant sums of money on non-essential items, which we would have gotten into the bad habit of buying prior to the health crisis.
Future Impact and Progression
So where does this leave the United Kingdom regarding finances moving forward? Well, the restrictions were recently lifted in May 2020, and although there has been significant confusion around what can and cannot be done in terms of personal income, there can still be savings to take advantage of moving forward. The Prime Minister has articulated that only essential workers who need to work away from home should travel to work, and therefore it could be argued there are savings to be had in transport costs to and from the workplace, as the majority of people will continue to remain working from home.
There are also hundreds of thousands of people drawing upon the Government implemented furlough scheme, which has offered some relief to UK residents by protecting a portion of their monthly salary. There have been recent developments about the scheme, and payments may decrease to 60% of an average salary soon, albeit for an extended period. Clarity will be needed on this as this will impact a large proportion of the nation.
This is certainly an interesting time to be around, and the general consensus is that the timescales for the full restrictions being lifted are currently unknown. Although this is worrying, clearly it is important for everybody to remain safe, and although there can be savings made in terms of personal finances, the health and well-being of individuals remain imperative, and it is essential that everybody adhere to any government guidance and advice pertaining to any restrictions. When the lockdown is lifted, there may be opportunities to rebalance personal income, and it could be argued that there will be opportunities in terms of employment, as the United Kingdom economy will need to be kickstarted again following its recent downfall as a consequence of the national pandemic.