People are planning spending cuts, but optimistic

The Customer Lifestyle Report has revealed UK adults plan to cut spending on takeaways, holidays and charity donations.
Despite the economic downturn people remain optimistic about their financial health, with 57 per cent rating their situation as above average.
Despite many cutting back on spending, there is a reluctance to abandon insurance policies, with half saying they buy it for peace of mind.

AXA UK’s Customer Lifestyle Report has revealed that almost two-thirds of adults are planning spending cuts – with takeaways, holidays and charity donations among the top items to curtail.

The study of 2,000 adults found those looking to curb spending are also planning to cut evenings out (22 per cent) and donations to good causes (26 per cent).

Products such as alcohol (16%) and cigarettes (10 per cent) also face the chop, along with shopping for clothes or shoes (18 per cent).

This could be in part due to a sustainability drive, with 34 per cent more likely to buy second-hand items.

There’s also a growing sense of self-reliance, too, as 36 per cent of people are likely to tackle DIY projects themselves as opposed to hiring tradespeople.

Despite the economic downturn and cutbacks, people remain optimistic about their financial health, with 57 per cent rating their situation as above average.

And 57 per cent also think they'll be in a better position next year.

People are having to make tough choices when it comes to their finances and will likely have to continue to reduce spending on things they otherwise would like to keep up.

Especially when it comes to insurance, it’s no surprise that cost is continues to be the main consideration for most, as people rightly want a competitive price and to know they’re getting a good deal. But at the same time, it’s essential their policy has the right level of cover for when they need it the most.

While there are unquestionably difficult circumstances, it’s encouraging to see most people are optimistic about the future and are making short term changes to protect the things that matter to their future.

Vicki Joshi, Chief Customer & Brand Officer at AXA UK

Despite reducing spending in many areas, there is a reluctance to abandon insurance policies, with 70 per cent and 71 per cent having car and home insurance respectively, while 44 per cent have breakdown cover.

Other popular products included travel (28 per cent) and pet insurance (25 per cent).

Price (47 per cent) was considered the most important factor when buying insurance, ahead of the level of cover (26 per cent) and it being from a brand people trust (12 per cent).

For those thinking about getting insurance in the next three months, half said they were doing it for peace of mind.

At AXA, we want to stay close, understand and respond to the changes taking place, which is why, we will continue to track, talk to customers and monitor behaviour to evolve our products and experiences to be reliable and relevant in our customers’ lives.

Vicki Joshi, Chief Customer & Brand Officer at AXA UK

Top 10 things people plan to cut back on

Takeaways – 26 per cent
Charity donations – 26 per cent
Magazines and newspapers – 23 per cent
Holidays – 23 per cent
Days or evenings out – 22 per cent
Clothes and shoe shopping – 18 per cent
Hobbies and activities – 16 per cent
Alcohol – 16 per cent
Gifts and celebrations – 15 per cent
Gambling – 15 per cent

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About AXA UK

AXA Insurance UK plc registered in England and Wales under registered number 078950 and authorised by the Prudential Regulation Authority and regulated by the Prudential Regulation Authority and the Financial Conduct Authority under Financial Conduct Authority registration number 202312. Registered office is 20 Gracechurch Street, London, EC3V 0BG.

AXA UK is part of the AXA Group, a worldwide leader in insurance and asset management, with 147,000 employees serving 94 million clients in 50 countries. In 2023, IFRS revenues amounted to Euro 102.7 billion and underlying earnings to Euro 7.6 billion. AXA had Euro 844 billion in assets under management as of December 31, 2023.

In the UK & Ireland, AXA operates through a number of business units including: AXA Insurance, AXA Health and AXA Ireland. AXA UK & Ireland employs around 10,000 staff.

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Certain statements contained herein may be forward-looking statements including, but not limited to, statements that are predictions of or indicate future events, trends, plans, expectations or objectives. Undue reliance should not be placed on such statements because, by their nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause AXA’s actual results to differ materially from those expressed or implied in such forward looking statements. Please refer to Part 5: “Risk Factors and Risk Management” of AXA’s Universal Registration Document 2022, for a description of certain important factors, risks and uncertainties that may affect AXA’s business and / or results of operations. AXA undertakes no obligation to publicly update or revise any of these forward-looking statements, whether to reflect new information, future events or circumstances or otherwise, except as required by applicable laws and regulations.

AXA UK research shows almost two-thirds of people are planning spending cuts, but most remain optimistic about their finances

Top 10 things people plan to cut back on