UK householders are feeling the most positive about their finances - from managing bills to paying off debt - for over three years.
Consumer confidence is at an all-time high, according to The Lloyds Bank Spending Power Report, which has been measuring consumer sentiment since November 2010. The index has risen six points since last month and is currently at its highest level since the survey began, reaching a record 129 points, indicating much improved optimism.
When it comes to the economic situation it seems that confidence is also rising, with the report recording a 91-point increase over the past year, and a rise of 12 points since December.
Further analysis reveals that the amount people spend on essential items has changed very little, but the constant increase of gas and electricity prices is weighing on people's minds. Inflation is a concern for around 77% of respondents, however they are spending around 2% less on fuel than last year.
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Meanwhile, people looking to get onto the property ladder are feeling more confident, perhaps buoyed by the Help to Buy scheme, with 44% of those surveyed feeling upbeat about the housing market – a rise of 3% over the past month. This positive outlook in the property sector is even more evident in London with 54% reporting feeling confident, but unfortunately it's not consistent across the whole of the UK with those in Northern Ireland reporting the most negative feelings at 68%.
Despite this, housing market confidence overall is overwhelmingly positive. This might suggest that more people will be checking out mortgage deals to get on the housing ladder, with this positivity being backed up by figures from the jobs market too.
As unemployment levels come down, it's no wonder people are feeling less negative about getting a job. Numbers of those feeling pessimistic about the employment situation is down by 2% on last month, and down 12% since last year.
When it comes to personal finances, 57% are feeling positive about their own money, and happily 2% feel they will be better off in six months time.
For those in debt, the future looks brighter too, with 11% feeling they will be able to pay off more of their debts, compared to 7% last month. If you have a few different debts and are paying a variety of different rates, it could be helpful to look into a debt consolidation loan. If you can put all your debts into one place, shop around for a competitive rate and take control of your finances, you'll be surprised how quickly you may be able to get debt free.
Once you're back in the black, it's time to think about savings accounts. UK households are feeling positive about putting a little aside for a rainy day with those that feel they will be able to save more rising by 8%.
Patrick Foley, chief economist at Lloyds Bank says: "Continued gains in consumer sentiment reflect the ongoing improvements in the UK economic backdrop. With the pressure on consumer wallets from essential spending remaining muted, if employment continues to firm and, looking ahead, wages begin to rise, boosting spending power, the greater capacity of consumers to undertake discretionary spending should place the recovery on a still-firmer footing."
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