Study shows how close families in the East of England are to the breadline
PUBLISHED: 17:34 22 December 2014 | UPDATED: 17:34 22 December 2014
The average family in the East of England would be just 33 days from the breadline if it unexpectedly lost its income, a new report reveals.
As festive shoppers crowd the town centres for the last weekend before Christmas, the latest findings by Legal & General show that many households in the region are just over a month away from becoming reliant upon family, friends or state benefits, once their savings run out.
Nelleka Van Helfteren, deputy manager at Ipswich and District Citizens Advice Bureau, said: “The cushion is absolutely getting smaller for a number of people, and for some of our clients there is no cushion at all.
“For some people if their income is a day or two days late it can have a major impact and we are seeing a lot of families that have to support each other so that is maybe causing savings to decrease.”
With some experts expecting interest rates to rise by the end of 2015, the report found that a 2% increase in mortgage interest rates would move the typical household with a mortgage one day closer to the breadline.
Ms Van Helfteren said the most important thing for clients who experience a change in circumstance was to communicate with creditors and see if they could find a short-term solution.
However the region has seen improvements, with the deadline increasing by nine days since the last report in 2013 – from 24 to 33 days.
The report states that these improvements are largely because the amount people are saving has generally increased, particularly among 18-24-year-olds. Becca Cotton, projects manger at the Eastern Saving and Loans Credit Union, said this could be down to better financial education in young people.
“Education for young people about budgeting and saving is really important”, she said.
“I think they are becoming more aware, but there is scope to improve and that is something we are going to work on in 2015.”
The breadline for the average household in the East exceeds the national average, which sits at 29 days.
The over-65s continue to lead the way nationally when it comes to saving, with a deadline of more than one year (379 days).