'Blinkered' Brits ignore financial reality

01/12/2009

Actual outgoings for utilities bills and other essential costs are higher than people think, according to a report released today (December 1st).

The Reality Gap Report, from insurance provider Bright Grey, suggests that Brits believe their annual outgoings to be around £892 per month.

In fact, each member of the working population spends an average of £1,378 per month - £486 higher than the estimate.

Moreover, Brits typically estimate that they could maintain their usual outgoings for ten months if they are made redundant by using their existing assets.

In fact, the reality is that they will last for just five months.

Roger Edwards, proposition director at Bright Grey, said: "They have no real concept of what they're spending each month, making it very difficult to budget and plan effectively.

"When it comes to financial planning, most people seem to have the blinkers firmly in place. However, if they start to pull together a realistic plan now they could save themselves a lot of heartache in the future."

Bright Grey also found that four in ten workers believe they could use savings to pay the bills following a job loss.

However, 38 per cent of Brits could not last for longer than one month on their savings.

Tags; Credit Card Lifestyle, Recent Graduate Debt, Retirement Money Problems, Job loss, Young Family Finances,

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