Business and Financial News

Many families will spend less this year

Christmas is a time for giving, but 2009 may be remembered as the year we all gave less.

Four out of 10 families plan to spend less this Christmas than they did last year because of financial worries, according to a survey of 3,000 parents by the Financial Services Authority.

Parents said they thought they would spend an average of £442 on presents and other festive spending, with 40% expecting to spend less than in 2008 and only 15% expecting to spend more.

Around 16% of parents said they had struggled with money during the past 12 months, while 3% admitted their finances were so bad they had been forced to speak to their lenders about repayment options and were struggling to pay their bills.

The biggest concern among families was not getting into arrears on utility bills, followed by being able to keep up with their rent or mortgage and being able to provide enough food for their family.

They were also worried about saving for the future and being able to afford presents for birthdays and Christmas.

Half of families admitted they would not be able to survive for more than a month if they lost their income through being made redundant or being too ill to work, with 18% admitting they did not have any savings to fall back on at all.

A further 14% of parents admitted they do not keep track of their spending habits, with the same proportion keeping only a mental note of what they spend.

The FSA runs a website, Moneymadeclear.fsa.gov.uk, which offers people help with budgeting and financial planning.

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