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?

We’re both WFH. We used to spend a large amount of money on commuting and a dog walker which means we’ve saved a lot! We’re very fortunate tHat I have a stable job unaffected by COVID. My partner was furloughed for a while but back in now.

Well, same as always here. No savings. Still paying full childcare costs. Still skint🤪
Both key workers so both having to go into work full time and thus pay for the childcare full time.
Must be great making money from this....
Oh, and I am frontline. Did my time in ITU and still no pay rise- bitter me?! Yep!

Our salaries haven't changed - we have been working throughout the pandemic and my job is public sector and working on the response to the impact of the pandemic in my specific field so quite secure. My take home pay has gone up by more than £400 a month due to lack of transport costs and cancelling gym membership (near office not home). My DP was complaining about the amount of online shopping I've been doing but I think I've still spent less than I would have done without the pandemic due to lunches and looking around the shops during my lunch breaks. We have used some of the extra time to do long overdue home improvements so did spend more there than usual (e.g. new carpet). We've also been spending more on groceries as we've been having Sainsburys deliveries rather than going to Lidl in person but I prefer it this way and the pandemic is just an excuse

I appreciate we're lucky compared to many around the country but this is normal amongst people I know. I think only one person I know was furloughed, everyone else was working from home. I'm not aware of anyone having lost a job either although that's not something people would exactly be shouting about.

Slightly better off here. Ive WFH through out, other half has worked as normal out of home. I always took my own lunch to work and never bought coffees so nothing saved there but I've saved a lot on fuel for commuting and general socialising. I'm in my 20s so most months was paying for bottomless brunches, days out in London, hen dos, hen weekends, weddings, birthday days out and all that has stopped. We also used to go abroad 4 times a year but only made it once this year. Over all we have a lot more in the bank

A lot of people have seen no (or little) reduction in income, such as public sector, pensioners, those on benefits, and those in unaffected industries (internet, supermarkets etc). By contrast, others have seen their incomes collapse, such as up to 3 million self employed, and those working in hospitality, sports, arts, etc.

We've saved a bit by DH not commuting to work and DTs activities being cancelled.

Me and DH are better off this year than usual. We both work in the NHS (me as a nurse, him in IT support) and lets just say we've not been short of work! Also DH has been working from home and saved a small fortune in petrol costs, and we've had money refunded from our holiday we couldn't have in the summer. So for us yes spending as normal.

I am very aware that we are lucky financially though and this year has been financially very tough for some families.

Food has been costing more as we had to change where we shop. Fuel has cost alot less. Household earner was on reduced wage for a long time but this didnt cause any financial worries as we were still able to cover all costs.
Saved as no holidays or days out costs.

People with savings are likely to be spending in case negative interest comes in which some are expecting. So they are spending money now rather than risk being hit by charges.

Its very circumstance based we are fortunate that we have very little outgoings, but understand for some people any reduction in income can cause massive problems.
If this had happened several yrs ago we would have been in are very difficult position

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?

Our income hasn’t changed but our expenses are much lower. WFH so no petrol, lunches etc. Car mileage much lower.

We are very lucky, DH is self employed and if anything busier than ever and has been able to carry on as normal right through. I am WFH now and saving about £100 a month on diesel, DS is on the shielding list but back working and back living at home so contributing to the bills. No eating out, no shopping, no weekends away, less spending on stuff we don't need, so we are able to use the surplus to clear some debts.

I think it has made me realise how much money we can save if we need to.

So financially

WFH, food costs have gone up (used to eat in heavily subsidised canteen) and DH used to travel so eating would be on expenses

Otherwise, no holiday / eating out etc expenses. We realise how lucky we are and continue supporting local food back and other charities.

Sadly, as Martin Lewis described, such shocks ('70's oil shock, '30s stock market crash) to the economy tend to go well for those in stable employment and badly for those in lower paid roles.

Only really governments are in a position to even out these cycles, if they are minded do to do.

I am very sorry it's not happening in the UK. Really impressed with eg Germany whose wage support scheme is currently scheduled to last for 24months.

I work for the NHS and my husband does IT for the department of work and pensions so we have both been working throughout with no loss of income my husband has been working from home so saving on commuting costs and buying lunch out. Also paid no childcare for several months.
So we have been carrying on as normal

DH and I both work for companies that switched to home working from the start of lockdown in March, so we've saved on travel and related expenses. Also both had payrises in that time as the industries we're in have been unaffected by the pandemic. Appreciate that we're obviously very fortunate to be in this position and able to spend as normal.

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).

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.

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.

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!

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.

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 .

@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 .

" 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.

@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.

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

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.