New Year – New Money: One third of consumers optimistic about 2024 finances

In a bid to take control of our finances after years of rises in inflation and household bills, nearly one in four (23%) of us have started budgeting in 2023 while half (50%) have sacrificed luxuries to save the pennies.

Around 80% of people have reduced their spending in the last six months, with takeaway meals (43%) and dining out (43%) topping the list of cutbacks.

However, consumers are willing to make exceptions on cost for the things that mean the most to them, with spend on festival tickets (15%) and home improvement projects (22%) taking priority over buying clothes (40%).

Overall, one in six (60%) feel financially resilient and able to handle unexpected expenses in 2024.

HSBC UK has devised seven steps to savings success in the new year including setting aside an emergency fund and looking for spending perks such as cash rewards or member discounts.

Pella Frost, head of everyday banking at HSBC UK, said: “The rise in inflation has created many financial challenges for consumers, but the end of the year is the perfect time to take a fresh look at your finances. Ask yourself: am I making the most of my money? Perhaps one of your new year’s resolutions could be to build a savings habit or review your existing arrangements. Take advantage of special offers or accounts where you will get a better interest rate, and make sure you contact your bank for further advice or support.”

HSBC UK’S SEVEN STEPS TO SAVINGS SUCCESS

1. Review your account.  The festive period is a great time to look back at your finances over the last year and make adjustments. Is your current account still serving its purpose or could you benefit from switching to an account that offers you more? Are there any direct debits that are no longer essential? Look through your transaction list with a critical eye to review your spending.
2. Find out your financial fitness. Knowing how healthy your finances are can help you work out what you need to do to achieve your savings goals. HSBC UK offer a free health check over the phone. Alternatively, use the financial fitness tool to get tips on how to improve your financial health.
3. Budget: plan your spending.  Like a balanced diet for your physical health, a budget can be the first step to better financial health and financial resilience. It should include essentials like rent or mortgage, utility bills and transport, as well as variable expenses like eating out, entertainment, travel, plus the odd treat. 
4. Save money (even if it’s just a little bit). Having goals and saving towards tangible targets is a great way to stay motivated. The key is to make it a habit. One tip is to set up a standing order to your savings account for just after you get paid, so you don’t need to remember to make a payment. Just like your current account, it’s good practice to regularly review your savings account to make sure the features and benefits are working for you. HSBC UK will often ‘nudge’ customers who may benefit from reviewing savings about new offers or accounts that can earn them more interest.
5. Do your research.  While you don’t want to be over-thinking or second guessing every purchase you make, it’s well worth doing your research when it matters.  Flights are a good example: find out which days might be cheapest to fly and how long in advance you should book to get the best price. Use comparison sites to look for better deals on finance products and utilities.
6. Look for rewards. Whilst switching can save you money, sometimes it pays to be loyal. If you shop at a retailer that has a loyalty scheme, you could take advantage of special member pricing, as well as receive money off vouchers and discounts. Similarly, some credit cards will offer cash rewards when you accumulate points on spending.
7. Prepare for the unexpected.  Most of us experience the shock of an unexpected bill every once in a while but having an emergency fund can help you deal with some of life’s curveballs. We recommend saving up about three months’ worth of living expenses. This would also help if you lost your primary source of income, such as your job.

Media enquiries to:

Hannah Langston, HSBC UK Press Office: 07384 792 248 / hannah.langston@hsbc.com