New figures reveal that household income increased by £69 in the second quarter of the year, mainly due to the drop in inflation.
The Office for National Statistics said that the average real household income had increased by 1.6% to £4,510 compared to the first quarter.
Real incomes hit their lowest level in five years at the end of 2011, but as Consumer Prices Index inflation has fallen back, from 4.2% in December 2011 to 2.4% in June, so the strain on household budgets has lessened.
Real household actual expenditure, meanwhile, has remained virtually unchanged, falling by £7 over the period.
A positive sign for the country's savings habits was the fact that gross household savings increased to £18.2 billion, from £16 billion in the first quarter.
Real actual income consists of wages and salaries; income received from pensions, benefits, share dividends, net interest and self employment.
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