How satisfied are Brits with their disposable income?

In a nutshell, ‘disposable income’ is the amount of money you have left over after paying essential financial obligations such as your rent/mortgage and bills. But how do Brits feel about the amount of disposable cash they have each month?

To get an understanding of the nation’s feelings towards disposable income, we decided to conduct a consumer poll, asking 1,500 participants about their views. We posed questions about topics such as whether they were satisfied with the amount they had and how much they feel is necessary to comfortably enjoy life.

Are Brits happy with their amount of disposable income?

To start with, our survey revealed that over half of Brits are either satisfied or very satisfied with their current disposable income (56%) – though, 1-in-4 people are either dissatisfied or very dissatisfied. Curiously, when it comes to perception, 40% said they believe young people have more disposable income compared to older generations, while 31% suggest older people are in a stronger position. Perhaps it’s a case of each age bracket believing the other has it better!

Applying a value, after all essential bills and costs are covered, around 45% of people believe you need more than £500 of disposable income a month to live comfortably, including a quarter of Brits responding that they feel £700+ is required. Of course, we all have varying perceptions of comfort, and 20% of Brits feel £100-300 is reasonable.

But how does the above vary according to factors such as age, location, and gender? Well, we’ll dive into a more detailed picture below.

Does your location impact how much disposable income you require?

When it comes to location variation, those in Belfast are the most satisfied with their disposable income, with 70% claiming they are pleased with the amount they have! However, those in Bristol and Liverpool are at the other end of the spectrum, with 35% and 36%, respectively, claiming they are dissatisfied.

When asked how much disposable income is needed to comfortably enjoy life, nearly half of those in Belfast said that more than £700 is necessary, whereas just 10% of those in Sheffield said the same. Many participants claimed that between £300-£500 is an ideal amount, such as 41.1% of adults in Edinburgh and 38% in Manchester saying so.

When we asked Brits whether they think younger generations have more disposable income compared to older generations, it was the 25% of agreeable respondents in Belfast who stood out to us – especially compared to just 8.4% in Leeds.

Finally, let’s dive into some stats around how long it takes people to burn through their disposable income. Many people still had at least some disposable income left over at the end of the month, including 47.2% of those in Glasgow and 43.3% in Southampton. Though, 11.6% of those in Bristol and Manchester admitted that they sometimes burn through it within the first day of being paid.

How has the cost-of-living crisis affected disposable income?

Next, let’s look into how the cost-of-living crisis has impacted levels of disposable income. Overall, 26.5% of people state that they’ve noticed no change, whereas a huge 67% of people say the cost of living has significantly reduced their disposable income.

But what does the picture look like across different gender, age and location brackets? Well, when it comes to gender, 43.3% of females and 44.4% of males stated that their disposable income has been somewhat reduced!

Meanwhile, around a quarter of 18–25 and 35-44-year-olds stated that their disposable income has been ‘significantly reduced’, with 30.3% of Gen-Z noticing a somewhat reduction (compared to nearly half of 55-64-year-olds).

Looking at the impact of the cost-of-living crisis by location, in Belfast, a whopping 60% of people have noticed their disposable income has been somewhat reduced in recent times, with 44.6% of those in Birmingham agreeing.

Interestingly, 39.7% of those in Manchester saw no change, and it’s a similar story in Edinburgh (34%). However, in Leeds, just over half of the population noticed a somewhat reduction.

The top expenses Brits are spending their disposable income on

Next, let’s give you an insight into exactly where people’s disposable income is being spent…

1. Eating Out - 50%

We saw high figures across the board with this one, with 63.2% of those in Belfast and 56.8% of those in London choosing this option. When it comes to gender, it’s a fairly even split, with 49.1% of females, and 50.6% of males saying eating out.

2. Going on holiday - 47%

50% of those in Bristol, as well as 54% of those in Nottingham said that this was their top expense! 51.7% of 55–64-year-olds said they’re spending their disposable income on holidays, compared to a slightly lower figure of 43.8% of 25–34-year-olds.

3. Hobbies - 36%

While only 36% said they spend their disposable income on hobbies overall, 40% of those in Bristol and 42.2% in Manchester said that this was a huge expense. There’s a fairly even split again when it comes to gender, with 35% of females and 36% of males choosing hobbies too.

4. Buying clothes - 33%

Nearly half of those we asked in Bristol said they are spending their disposable income on clothes (47.5%), whereas only 21.1% said the same in Belfast. Furthermore, more females are spending their disposable income on clothing (38.2%) compared to just 26.5% of males.

5. Drinking - 30%

Next, we have drinking, with 44.4% of those we asked in Newcastle choosing this option. Alternatively, just 9.3% of participants in Edinburgh chose this as an expense. Finally, more males are spending their disposable income on drinking - 36.2%, compared to 32% of females.

Top tips on how to make your disposable income go further

Wondering how to make your own disposable income stretch further into the month? Well, let’s leave you with a few handy tips:

1. Create and stick to a budget: first thing’s first, you’ll need to start by carefully tracking your income and expenses. This will help you determine how much disposable income you have each month, and enable you to plan out exactly how you’re going to spend it. Only 47.1% of those we surveyed said they felt confident with budgeting, so if you’re looking for a little help, we’ve got a guide on how to build a budget.

2. Cut back on unnecessary expenses: another great way to boost your disposable income is by cutting back on other expenses. For instance, do you have any unused subscriptions? If so, why not cancel them to free up some funds to spend as you wish!

3. Plan and shop smart: another way to boost your monthly funds is by shopping smart and planning your weekly meals. Going to the store with a plan in mind is bound to help you stick to your budget. Plus, remember to keep your eyes peeled for cashback and rewards programmes.

4. Negotiate your bills and services: finally, how about doing some research to see whether you can get a reduction on your bills? Simply research competitors’ rates then call your providers to enquire about yours.

So, there we have it, a detailed picture of how Brits view their disposable income. If you’ve experienced a hit to yours recently, and you’ve been looking for ways to generate extra funds, make sure to bear the above tips in mind! And for more insights, head over to the Moneyboat blog, where you’ll find guides such as simple ways to save money today!

Methodology

We surveyed 1,500 respondents to find out how they feel about their disposable income. Data is correct as of 19/08/24.