9 in 10 people in Ireland will take cost cutting action this year, according to new Aviva research
More than one in three (35%) households have fallen into a weaker financial position in the last 12 months
Women more likely to say they’ll shop around for the best deals
One in three plan to turn down the heat
Almost nine in ten (88%) people living in Ireland are planning to take cost-cutting measures in the hope of slashing their spending this year. This comes as more than a third (35%) report to being in a weaker financial position today than they were a year ago.
Research released today by Aviva Insurance Ireland DAC (Aviva) has also revealed that the Top Five cost-cutting measures which people are planning to embark on this year are:
- Shop around for better deals, with more than half (54%) planning to do so
- Eat out less - more than four in ten (42%) intend to do so
- Buy less clothes (38%)
- Use home heating less (32%)
- Do more ‘free’ activities, such as cycling, walking and sea swimming (27%)
In the survey of 1,000 adults nationwide* 37% of women said they were in a weaker financial position, compared to 31% of men. The research also revealed that age was found to have a considerable sway as to how upbeat an individual is about their finances. Those aged between 25-34 were most likely to say they’re in a stronger financial position today than a year ago, with more than half (52%) expressing this view. However, those age 45-54 are most likely to feel they are in a weaker financial position at 39%, while those over 55 are most inclined to say their position is the same (42%).
The findings of the survey show the impact of two years of record high inflation on household purses. While Irish inflation has started to fall below the 5% mark since September 2023, prior to that it had remained stubbornly and often significantly higher for two years¹. Given that more than one-third of our survey respondents feel they are in a weaker position than last year, it’s evident that we need general inflation to continue falling for some time yet before families can feel less financially squeezed and a little more confident about their finances.
Julie Frazer, Aviva
The Aviva survey also found that, although the majority of respondents (65%) are in the same if not better financial situation than they were 12 months ago, almost all are still planning to make some changes to their consumption and spending habits to cut household expenditure.
What’s interesting is that it’s not just those who feel they are a little more out of pocket this year that are going to try to claw back some money where and when they can. The research provides a good insight into how people believe they will save and what they are willing to forgo to do so. For example, while the number of overseas holidays trips taken by Irish people has steadily increased in recent years despite the cost-of-living crisis², there is now evidence that the recent price squeeze is starting to have an impact on holiday plans with one in three (31%) saying they will go on a cheaper holiday or won’t holiday at all this year.”
Julie Frazer, Aviva
Further highlights from the Aviva survey include:
- One in three (32%) plan to use their home heating less in order to cut costs, while only a fifth (19%) are prepared to cancel their streaming services.
- People are more inclined to give up takeaway teas and coffees, with 26% saying that they would do so, rather than using their car less at 17%.
- Women (61%) are far more likely than men (46%) to shop around for better deals.
- Women are more likely than men to say they’ll buy less clothes (46% v’s 29%).
- Men are more inclined than women to say they’ll use their car less (20% v’s 15%).
- One in ten (9%) of those surveyed aged 25 – 34 are prepared to cancel their health insurance in order to save money. This was three times as high as the number of people aged 55+ (3%) who were prepared to do so.
- Unsurprisingly the youngest age group (18-24) are the least likely to be willing to socialise less (13%).
- Those over 55 are the most likely to say they don’t plan to make any changes to their spending habits with more than one in five (22%) saying this. By contrast, the youngest cohort (18-24) and arguably those with the least amount of money are most likely to change their spending habits, with 96% saying they would do so.
“There is no doubt that households have come under pressure as a result of the cost-of-living, but if a positive can be taken from this, it’s that it has probably made a lot of people more budget-conscious and more aware of simple steps they can take to save money. It is often only at times like this that people learn the value of cutting back and as a result they take up good budgeting habits that they continue to use well into the future,” concluded Julie Frazer
1. See Consumer Price Index January 2024
2. See CSO Household Travel Survey Q3 2023
*The research was carried out by iReach Insights on behalf of Aviva.