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FM29 - Low Spending Power Rising mortgage payments and living costs means that households now have a smaller proportion of income to spend on discretionary purchases than at any time in the last five years, according to a new survey. Once tax contributions, mortgage payments and household bills are deducted, the average family in Britain has just 22 per cent of gross income left over, compared with over 28 per cent in 2003. Strong consumer spending has been the engine of Britain’s economy in the past few years, powering six quarters of above-trend growth. Figures show spending has so far held up well in the face of higher interest rates – largely because Britons have been able to borrow against the rising value of their homes – but retailers are concerned the spending squeeze is likely to intensify. British interest rates are expected to hit 6 per cent by the end of the year and many homeowners coming off fixed-rate deals will see their mortgage repayment costs surge. The survey shows fixed monthly household costs have risen by nearly 32 per cent since 2003/04 and now account for more than half of a typical household’s gross income. Council tax and pension contribution payments have also risen faster than inflation. |
"He (Mac) has helped me as my practice has expanded from single-handed to a six surgery/8 dentist practice." "Mac is always available to "pick his brains" and has a solution for any problem!" "He always offers sound independent advice on all financial and taxation affairs in a way that is easy to comprehend and follow." "He has helped me through my early associate days and is now proving invaluable in my journey towards practice ownership." "There is never anything I do in business or personal finance without first consulting Mac." |
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