UK households start 2019 on downbeat note over finances

Living costs have increased at the slowest rate in three years this month, but UK households remain concerned about their cashflow, job security and the housing market.
The January Household Finance Index (HFI) Index, compiled by Markit Economics and providing the earliest indication of actual changes in UK household finances each month, shows that, despite a rise to a three-month high of 44.8 in January, it still remained below the no-change mark of 50.0, thereby indicating that UK households expect finances to deteriorate over 2019.

According to survey respondents, workplace activity among high earners grew solidly during January and at a slightly accelerated pace, and those in higher income brackets also saw earnings from employment grow.

Having hit the lowest level of confidence in six years (excluding the month after the EU referendum) during December, confidence in the property market remains low, with households in London, Scotland and the North East expecting house prices to decline over 2019.

Joe Hayes, Economist at IHS Markit, comments: “There was no financial respite at the beginning of 2019 for UK households, with survey data showing current finances once again deteriorating. Expectations remain anchored upon this downbeat trend continuing throughout the year ahead. A number of other survey indicators reinforce the negative stance by households, as job security perceptions deteriorated to a near one-year low, while there was no bounce back from the stark drop in house price expectations seen in December.

“Political deadlock over Brexit merely adds extra uncertainty to an already unfavourable financial environment for UK households. However, improvements may come to the fore in coming months if uncertainty about the path of Brexit becomes more clear. Furthermore, survey data show that living costs have risen at the slowest rate since the start of 2016, helping to alleviate cost burdens and free-up disposable incomes.”

For information about how we can assist by putting processes in place to lessen the impact of the current economic and political uncertainty on your personal wealth, contact us. Our experts at Beavis Morgan are available to structure your personal and business finances with cashflow and profit forecasting to measure performance and maximise opportunities. We work to a pre-determined plan, to help you avoid any nasty surprises.

In turn, if you have any concerns relating to your property portfolio, or would like professional advice on how best to structure your property deals, both to ring-fence and protect your property assets, as well as to minimise the tax arising from your business operations, we are available to assist. Our property experts at Beavis Morgan offer extensive experience in advising individuals and businesses on all aspects of the property market. 

Contact Steve Govey or your usual Beavis Morgan Partner for more information.

Further reading:
SME Adviser Series: Tips for better managing cashflow