Despite certain concerns, most Brits are feeling optimistic this year, predicting that their monthly disposable income will rise to £360, up from £349 per month in 2017, according to research by VoucherCodes.
As a result, 75% of surveyed Brits are feeling positive about the state of their finances for the year ahead. This is quite a change from the 41% who were feeling positive at the start of last year. Part of the reason for this uplift in optimism is the fact that 29% have had or are expecting a pay rise.
In contrast, the 25% who are feeling negative about their financial outlook cite rising food prices (62%), household bills (54%), the weak value of the pound (38%) and uncertainty over the ongoing Brexit negotiations (30%). Given all these concerns, they would do well to follow the example of optimistic Brits, who are planning to be much savvier with their money this year.
Those Brits with a sunnier outlook are planning to either shop around for the best deals (25%) or take the time to budget properly (22%). Furthermore, 26% are planning to cut back on takeaways, while 24% will dial back their meals out and 24% are set to drop expensive groceries.
However, they are still planning to splash some cash, with holidays (39%) and house renovations (16%) topping the list of things Brits are planning to spend big on this year. This is followed by 14% who are planning to pay off personal debt, which could be costly but would also end up saving money in the long term.
The rise in disposable income, combined with the above money-saving resolutions, should allow people to save more. And indeed, the average Brit is hoping to squirrel away £221 per month, up 13% on the £196 that Brits managed to save on average per month in 2017. This money will be going to 2019's holiday (25%), retirement (15%) or a house deposit (10%).
But what's the best way to save for these goals? A regular savings account could be ideal for putting aside a little every month, and you should have access again in time for next year's holiday. While you could put extra money straight into your workplace or personal pension, there's also the lifetime ISA to consider. This gives you a Government bonus and even allows you to use the funds for a first house purchase as well – just be careful, as the lifetime ISA is likely to require investment in the stock market.
Have a look at the best savings deals to make the most of your extra disposable income
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