Page last updated at 00:20 GMT, Friday, 4 April 2008 01:20 UK

Families 'planning spending cuts'

A piggy bank, cash and bank cards
People are making plans for spending less cash this year

Nearly three quarters of households say they are planning to cut their spending this year, according to a survey.

The credit crunch and a lack of money left over each month means some will cut savings or their pension payments, while others say they will go out less.

The research from financial provider Axa said that some blamed the burden of high house prices.

Others said paying debts was the problem, and people have had to take on extra work to help with their income.

The research found 70% of households said they plan to cut their spending this year.

Also, 37% say they will be eating out less, with 19% not socialising as much, and 8% were thinking about not renewing their insurance cover.

We've had it easy for so long and been happily spending without thinking of the consequence
Steve Folkard
AXA

The research also found that one in six are going to stop saving or cut their pension contributions.

And 11% said someone in their household has taken on additional work to bring in extra cash.

AXA spokesman Steve Folkard said: "It's no wonder that households with above-average incomes are struggling to cope.

"A typical family in Middle Britain may have a higher than average income, but millions are weighed down by high lifestyle costs and face tough choices as the strain on their finances takes its toll.

"One of the biggest issues, however, is that many seemingly well-off households lack the motivation to tackle their problems.

"We've had it easy for so long and been happily spending without thinking of the consequences, that now people aren't sure what to do."

More than 2,000 people were questioned by YouGov during March for the Axa survey.




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