How are so many people still spending as normal?

[nc1962]

I'm so confused by what I'm hearing compared to how people seem to be living their lives.

On the one hand, it's everywhere about job losses, redundancies, people not being able to pay mortgages. But on the other - a lot of people I know/vague acquaintances are going on holiday at every opportunity, buying a lot of stuff and spending a lot of money on house renovations.

Our household has been hit badly by all of this, with a massive drop in income.

Of course it's different for everyone and up to people how they spend, but I'm so uncertain what to think. Are there really so many households (normal as opposed to very rich) who have been able to carry on as normal? I thought we were very typical in terms of having taken a big hit, but now I don't know what to think and whether this is a short term or long term thing.

I wanted to ask what others are finding to be the case - are a lot of people you know carrying on as normal, or has there been a big financial impact?

[Runnerduck34]

Reading these posts wish our outgoings had dramatically decreased! We are fortunate that our income is unaffected but our commuting costs were low and always took packed lunches etc so havent saved much by WFH what we have saved seems to have gone on increased cost of groceries and are helping one DD through uni and paying for driving lessons for another so no savings here and we are spending more but not on treats or luxuries

[Liking80]

I was made redundant during lockdown. My previous role workplace was home. In reality I spent most days on the road visiting clients & even if in one of our offices, I could claim all my fuel costs from the minute I left home. I spent a fortune on coffee and snacks though!
I was fortunate to get a new role on the same salary however this is a 120 mile round trip & my place of work is the office so fuel costs to work are at my expense. I am slightly worse off but now I drink the office coffee for free!! As there is less to do socially I am still winning. I hope when things become old normal, I will be back on the road, expensing fuel costs!

[Bambooble]

I'm intrigued by the childcare costs, aside from when everything was closed earlier in the year, are people still WFH with children?

[MerryGoRoundBrain]

No extra savings here! DP works as normal, I wfh but only used public transport before, so it’s not a massive saving in that respect. We took a couple of breaks within the UK and went to see my parents who live abroad, so money was still spent on flights, meals out etc. DC is into football, all his clubs have reopened. We were never massively into going out, we still get takeaways. So yeah, still spending! But trying to keep it local, as much as possible.

[DominaShantotto]

No childcare since both of us are at home (it's shit and I wish we weren't), no commuting costs - minimal petrol for the car and I'm not buying train season tickets anymore, and my course has just got the reinstated health profession training allowances. Kids' activities have been stopped and are only just restarting, or have folded completely (their amazing dancing teacher gave up teaching).

And I'm at home, bored, isolated, doing online lectures, and shit just falls into my shopping cart as a result.

Yes financially we're better off - but I'd give that up in a heartbeat to go back to where we were end of last year.

[Amijustagrump]

Our household is amazingly better off. Dh is a paramedic and I'm a teacher and we have both been promoted during this. However we know this is not the case and we are trying to do a majority of our spending in small local businesses to support our local community

[Plummeting]

Like you say it depends completely on the individual situation. Our household income hasn't changed and there is no suggestion of job insecurity or pay cuts. On the other hand a lot of our usual outgoings have stopped/reduced: previously we ate out now it's a takeaway, the kids after school clubs ended and we don't feel 'safe' to restart them yet. We usually visit friends/family regularly staying in hotels and spending money on petrol - we've stopped this for now. Also no foreign holidays this year.

Income stayed the same, outgoings reduced = masses of savings. We could easily afford fancy holidays or a new car or renovations atm, and while I know some people are really struggling we certainly aren't the only ones who definitely aren't. (I've doubled our monthly donation to the food bank btw, since the start of lockdown, just saying because I know all the above makes me sound a bit awful)

[ohthegoats]

Same storm, different boats.

Still working full time - I'm in school, partner officially worked from home anyway, but used to go to London a lot. We've managed to save lots of money. No commute, no eating out, no holidays, much less 'social petrol'. We've changed our charity direct debits accordingly - to local foodbank, refuge etc - and are buying local and from small businesses rather than the biggies.

[PegasusReturns]

We’re fortunate in that income has increased overall. But where I spend and on what has changed.

DH’s work has gone through the roof (architect/build) and they can’t keep up with enquiries as so many people want extensions/ remodels.

This time last year I did the bulk of my shopping at the supermarket with a smaller proportion at the butcher/baker/fishmonger.

I’m now trying to do all my food shopping from independents/markets. I’ve got more time as WFH and since we’re not eating out the overall spend on food remains the same.

Not spending on holidays has made a huge impact on expenditure m. Ordinarily we’d have skied twice had a big summer holiday and two smaller half term breaks. Christmas will also be lower key.

[LBOCS2]

• We're still spending because, put bluntly, we can afford to. Our income is unaffected. We also want to try and do what we can to safeguard other people's jobs, which involves spending money, so that might mean saying yes to more things than we did pre covid. Because if I want businesses and amenities to survive I need to support them.
  
  What we have changed is we've spent on different things. Made a specific effort to use local retailers not supermarkets, gone on days out to outdoor not indoor places etc. So the habits have changed but the amounts aren't that different.*
  
  This is us. We work in a very stable area of property (pretty much the only stable area) but have moved to WFH so no commuting costs, no lunches out, morning coffee, etc. Kids' activities were all cancelled, less petrol being used, and throughout the summer we didn't have childcare costs. We're trying to spend specifically with smaller, local companies, rather than the big multinationals.

[Porcupineinwaiting]

@nc1962 it is certainly true that where (geographically) people spend money has changed, I'm not sure that's entirely a bad thing though. Our local parade of shops and take aways is booming, including, fe, our local butcher who was warning last January that he'd have to close if business didnt improve. In contrast, a lot of city centre cafes and restaurants are in trouble.

It may be that this pandemic breathes new life into the little suburban businesses that have been quietly shutting for years.

[HollyRoadRaider]

@WearyandBleary

Saved loads due to not eating out, no weekends away, no theatres, no petrol (for commute). We are finding we have about 1k a month more. It’s shocking really if you multiply that up by the whole economy, you can see why it’s ground to a halt.

Same here. We both work in the public sector and have been mostly WFH with no worries about losing our jobs. The money we've saved since March - no commuting, no lunches / meals / coffees out, no holidays or days out have paid for my daughter's university accommodation for the whole of her first year with some left over. It's made things a lot easier for us; it might have been a struggle otherwise.

[TabbyStar]

It's quite striking the different experiences:

We've managed to save absolute thousands in such a short space of time.

Versus

We’re screwed.... Our carefully planned retirement is now looking quite bleak.

[polkadotpixie]

I'm spending as normal, I work for the NHS so my job is rock solid and my husband is self employed in a job providing a service that people will always need and is COVID-secure. I'm still skint but that's cause I always am, not because of COVID

[HairyToity]

We have not had the covid financial hit some have. I'm concerned about Brexit having a hit next year. We are trying to avoid getting covid, and so haven't been going out for meals or to soft play etc. We have replaced our car though, with the money we have saved.

[MRex]

@shinynewapple2020 - www.ft.com/content/2782655a-0441-4d38-bb03-5c4e67ead110

[Orcus]

@nc1962

I'm glad to hear so many Mnetters haven't been badly affected!

I am still confused though- there are a lot of responses here and hardly anyone has talked about a big income drop or job loss. I'm not quite sure what to make of that compared to so many stories in the news about mass redundancies?

Also, it's good that everyone is saving as a result of WFH, but there must be so many business/people affected by that money not being spent anymore. What about the people who work in the food outlets everyone was buying their office lunches from, the dry cleaners, the places selling office clothes, the gyms near office areas, people who's work is to do with airports, people in the hospitality and entertainment industries? I suppose there might just be a small number of those people on MN, so the responses aren't covering a cross section of everyone?

MN is not representative of the population as a whole. The demographic skews disproportionately educated. There are also significant cohorts of non-wfh professionals on here, particularly teachers, and those roles are some of the safest. Whereas the hospitality and travel industries, for example, skew young, so there probably aren't so many parents in them.

[Gwenhwyfar]

" I'm not quite sure what to make of that compared to so many stories in the news about mass redundancies?"

Mass redundancies means a lot of redundancies, it doesn't mean most people just like high unemployment means it's higher than usual. It would still be the case that most people have jobs.
Also, a lot of the terrible impact, the awful recession are in the future and haven't really started properly yet.

[shinynewapple2020]

@MRex where did you get that information from around 80% of current cases coming from Spain ? I've never heard anything like that at all .

[shinynewapple2020]

Our earnings unchanged but saved so much money not commuting or buying lunches out. Spent less on clothing too as I'm mainly living in joggers and hoodies and rarely going anywhere I'd want to wear anything nicer. We also saved money on meals out during lockdown, although have been out a few times since and had takeaways. We've also been on holiday but instead of holiday abroad with meals out and cocktails, we've had a few Self catering UK breaks .

[ReadySteadyBed]

We’ve saved as a household even though I took a 20% cut for 5 months before being made redundant but I got a fairly generous redundancy so at the moment we can continue as we are and we’re in the middle of S house renovation. I’m looking for a new role though as the money won’t last forever.

[MushMonster]

We are both still working, and we had no furlough either (priority sector, but no NHS).
It all depends on which sector you happen to work in, unfortunatelly.
The more money is put back in circulation, the better for all of us though. So doing those bits and bobs that you need in the house and so make sense to me. But not abroad holidays! That does not sit well with me!

[thevassal]

According to ONS
"In September 2020 retail sales volumes increased by 1.5% when compared with August; this is the fifth consecutive month of growth, resulting in an increase of 5.5% when compared with February's pre-pandemic level."
www.ons.gov.uk/businessindustryandtrade/retailindustry/bulletins/retailsales/september2020
so seems like a lot of people are still spending!

I understand and appreciate people spending in local shops/getting things they know they need now, rather than saving with no interest rates but do think that people who could afford to but aren't saving at all (or not more than normal) are being a bit short sighted given next year will almost inevitably be the biggest recession (possibly even depression) in the last century, plus the effects of Brexit....

My resolution this year was actually to spend more....! Haven't been able to because I don't really like 'stuff' and prefer going out/experiences, but all the holidays, theatre trips, hen parties etc. I'd planned on have been cancelled. I would love to go back to swimming, exercise classes etc. and happy to pay more but the restrictions placed on them have just made it impossible. Similarly I'd have loved to have gone out for food/drinks over the last few months, but am in Wales so total lockdown atm and local one for the prior 5 weeks, which as it limited going out to with your own household only, and DP works away so I live alone, was a no-go.

[Jessy2903]

We've been incredibly lucky, both working, no incomes hit.
All nursery, travel and club expenses cancelled.
We've managed to save absolute thousands in such a short space of time.
Very thankful and know not many are in this position.

[MRex]

Working throughout as normal, some lower expenses in not commuting, very little eating out, etc. Higher costs with new childcare, but that was planned. We have savings and we have income, so we're consciously trying to buy more things or services that we would have bought anyway in the next couple of years. It's better to try and spend more if you're someone with disposable income at the moment, others need that money for their own income and to keep the economy moving.

We would not go on holidays abroad right now though. Unless people are visiting family I personally think it's irresponsible to travel abroad during a pandemic and shouldn't have been enabled to the extent it was; given we now know 80% of current UK cases came from Spain, that should be fairly obvious to anyone (yet like OP, I still see some people "deserve" a trip to Greece, for reasons unclear and unspecified).