Household costs have soared by £4,000 over the past year, according to research by Aviva.
The typical UK family is now spending on average £1,819 a month just on essentials, compared to £1,489 in November 2011. That's a rise of 22% over a period when typical monthly net income among UK families rose by only 3%.
The result is that families are cutting back on non-essential spending, according to Aviva's Family Finances Report. For example, since November 2011 the number of families spending on sport and leisure goods has fallen from 61% to 55%.
However, the typical family's savings are improving. In January 2013, the average family had a savings pot of £1,277, compared to £967 in November.
Louise Colley, head of protection sales and marketing at Aviva, says: "This latest report reveals a mixed bag of fortunes for UK families as they face higher living costs set against relatively stagnant incomes. However, it's promising to see that families are adjusting their spending habits to take account of these changes and good news that these growing expenses have not prevented families increasing their debt repayments or savings."
How costs have increased
|JANUARY 2013 (MONTHLY COST)||NOVEMBER 2011 (MONTHLY COST)||INCREASE PER MONTH||INCREASE PER YEAR|
* Based on the monthly increase over a 12-month period - please note that some expenses are subject to seasonal changes.