Having a family comes with additional financial responsibilities. However, since the start of the cost of living crisis, families are facing more financial pressure which brings further stress and worry. This is only heightened by the upcoming half-term and summer holidays when the kids no longer spend the majority of their week at school.
That’s why we conducted research, speaking to those supporting a family to find out how they’re coping. We asked how they’re financing their family, the biggest costs they have, their plans for childcare during the school holidays, and what changes they might be making to make ends meet.
With rising prices, many families may not be able to rely solely on their work income to pay towards the costs of supporting their family. Almost two in five of those we spoke to (37%) said that they’ll likely dip into their savings to provide for their family.
However, not everybody has money already put aside. Just over a quarter (26%) responded that they’re selling items on second-hand websites like eBay and Vinted, while 22% said that they’re extending their overdrafts to cover the costs. Meanwhile, a fifth (20%) are having to get a second job to increase their income and 17% are applying for loans. According to our research, 12% know that they need to find the money somewhere but aren’t sure where to do so while 8% are going to be relying on government funding.
Whatever way people are financing their family, it seems that most will be looking for additional income as only 19% said that their income alone is enough to support their family.
Obviously, the cost-of-living crisis has resulted in many households having to pay out more for basic household costs, but where is this money going?
Over half of those we surveyed (56%) said that their biggest total cost comes from food and drink. A third (33%) are finding that using the car or other transport costs like taking the bus or train is eating into their household income the most. According to a fifth (20%) of those we spoke to, they’re spending the largest chunk of their household income on childcare.
Other non-essentials like being able to enjoy free time together as a family also appear in the research, with the costs associated with family activities and holidays being the
largest outgoings for 30% of families we surveyed. Similarly, big family events like weddings are adding up and totalling the largest amount for 12% of those we asked.
Not only are families having to deal with rising costs, but we discovered that over one in ten (11%) are accumulating up to £500 a month in debt to survive during the cost-of-living crisis. If you’ve got a Lowell debt and are struggling to keep up with your payments, please get in touch and let us know so that we can support you. Alternatively, there are organisations that you can speak to for free independent debt advice and support.
As outgoings rise, families are having to cut back where possible to make ends meet, but which are the first things to go? Unfortunately, a quarter (25%) of those we surveyed said that they won’t be able to put any money aside into their savings accounts as they need it now.
The research also discovered other less essential outgoings and purchases which households are no longer able to afford. In fact, the first thing families said they’ll be sacrificing is going out to eat, with a little over a third of families (34%) choosing to remain at home for meals instead.
Celebrating special occasions is also seemingly becoming more difficult as well with 28% saying that they’ll be sending fewer birthday and Christmas gifts to loved ones. Meanwhile, 28% said that they’ll be taking a break from shopping for new clothes.
It appears there won’t be as many family breaks happening this year either as another 25% are cancelling any upcoming holidays they had planned. Subscriptions such as Netflix and Amazon Prime are also going to take a hit for 22% of households.
The sacrifices families are having to make are also looking to impact school life with 18% telling us that they’ll be sticking with budget packed lunches and 14% are even going to have to say no to school trips.
Throughout the year when schools close for the holidays, this can bring extra financial burden onto parents as they figure out how to take care of their children and the costs that come along with it.
In fact, almost a quarter of parents (24%) told us that they’re worried about how they’re going to be able to afford additional childcare whilst at work - but sadly that isn’t the only money worry facing parents. 23% are concerned about how the school break might impact household bills and 13% think they may have to take unpaid leave to cover childcare arrangements.
Worryingly, 17% of Brits with a family to support are unsure how they’re even going to be able to afford to feed their family during the school break, while 12% don’t know how they’ll cover the cost of a new school uniform.
Alongside this, our research suggests families are having to change other lifestyle habits as well with 13% of families no longer able to afford to go on holiday together and 12% of parents worried that their child might miss out because they can’t afford to keep them entertained during the break.
Keeping the kids entertained, especially during the school holidays, can add up and become expensive. But it doesn’t always have to be expensive to have a good time, and there are ways you can spend less without compromising on fun.
If the kids are staying at home during the holidays, then you can find all sorts of free activities and ideas to keep them busy available online on websites such as Twinkl. There you can find a range of resources including crafts, printable board games, and colouring pages to name a few.
Learning about the importance of money from a young age is important as it introduces good habits from the start to help them in later life. It can also help them to avoid financial problems in the future when they start putting things into practice as they get older. Our blog on the financial tips we wish we’d learned as a child is a good place to start and includes further tips on how to help your child learn about money.
There are places to turn to if you need additional financial support for childcare. You can look into this yourself by using our benefits calculator, powered by entitledto, or get free advice from independent organisations like Citizens Advice to find out what you might be able to claim.
The official government website also has lots of information on help paying for your childcare for toddlers or teens and what support you might be entitled to.
Here at Lowell, we understand that it’s not an easy time for families and their finances. Our customers are our top priority so if you’re struggling, please get in touch with our friendly and supportive team to discuss your next steps and how we can support you.
Published by Stephanie North-Shaw on 24th April 2023
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There are lots of ways that Lowell can offer you additional support with your debt. Find out how we can help you today.