How UK Households Are Slashing Spending in 2023
Quick Take‑away
- More than half of Brits have already cut back on non‑essential spending.
- Up‑to‑half say they’d ditch luxuries if the energy‑bill discount vanished in April.
- Energy, mobile and broadband bills are pushing families to tighten their belts, with a third using savings for essentials.
- People are swapping brands for cheaper ones, hunting bargains online, and shifting from pricey retailers to discount chains.
Why the buzz: The Energy Bills Support Scheme that gave a £67 monthly discount from Oct‑March is now getting means‑tested. Wallets are feeling the pinch and households are already adjusting their shopping habits.
What the Numbers Say
- Half of respondents would cut discretionary spend if the discount stops.
- Similarly, about 33% would dip into savings for energy bills.
- So far, 55% have trimmed non‑essential spending in 2023.
- Income‑and‑savings‑driven spending for the next three months is held back mainly by rising utilities.
Telephone & Internet Price Hikes
- Half of participants expect mobile plans to jump in cost from April.
- Half also foresee broadband charges climbing.
- Only one‑tenth claim that neither has increased.
Consumer Behaviour in 2023
- 37 % are buying more own‑brand or value items.
- 36 % are chasing promotions and discounts.
- 33 % spend extra time hunting bargains.
- 33 % cut down on the number of items they buy.
- 31 % switch brand names on the fly.
- 29 % move to cheaper retailers.
- 29 % shop across more than one store.
- 11 % are free‑flying with credit.
Saving for Necessities
- About a third of people use their savings to cover essential costs.
- Two‑thirds with savings don’t feel the need to tap into them yet.
- The average savings stash sits at £7,744.
Big‑Ticket Purchases vs. Big‑Spending Intentions
- 41 % of savers haven’t bought anything major yet this year.
- 34 % say they won’t splurge on big items for the rest of 2023.
- Among those who have spent on larger items, home improvements lead (22 %).
- For the remainder of the year, roughly a third plan to shop on home improvements, with a holiday being the next favourite (about 25 %) and other big purchases trailing behind.
Financial Confidence in 2023
Feelings about financial security are a mix: 25 % feel safer than at the year’s start, 29 % feel less secure, and 45 % remain unchanged.
Thoughts from the Experts
Linda Ellett, KPMG UK’s Retail & Leisure head, notes:
“With energy, mobile and broadband costs climbing, many will cut discretionary spending even further. A lot of shoppers are already chasing lower prices—switching to discount brands, buying in bulk, and hunting for promotions. Yet, a sizeable chunk will still be tempted by the prospect of more significant purchases, especially if essential costs finally calm down.”
In short: UK households are already navigating smarter, cheaper shopping habits—yet the pressure of rising bills is clouding the prospects for splurges and savings.
