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One in five have little or no idea about the state of their finances

Posted on 19 September 2015

SunLife have researched people's budgeting habits

  • More than half never formally budget
  • 22% have either no idea or a ‘rough idea’ of incomings and outgoings
  • Those who budget formally are happier than those that don’t

More than a fifth (22%) of people in the UK do not formally budget, admitting to having only a ‘rough idea’ or no idea at all about the state of our own finances, according to new research from SunLife.

The study, which asked more than 3,000 people about their budgeting habits, discovered that only 44% of people use either an app, online tool, spreadsheet or a notebook to budget. More than a third (35%) said they don’t budget formally, but do always have a clear idea of their incoming and outgoings, 16% said they had a ‘rough idea’ while the remaining 6% said they don’t budget at all.

Sunlife found that younger people are much more likely to budget than older people, with 57% of 18-24 year olds saying they budget formally compared to just 32% of over 65s. Younger people are also more likely to make use of technology to budget, with 18% of 18-24 year olds using an app or online tool compared to the UK average of 7% and the over 65's figure of 1%.

Dean Lamble, Managing Director of SunLife said: “There could be lots of reasons why younger people are budgeting more formally than their parents and grandparents generations. But, living through seven years of recession – starting at around the time many of this generation started to become responsible for their own finances – has probably had a huge effect on how they view money. The continuing rise in the cost of attending university and buying your first home could also be forcing more young people to keep a very close eye on their finances.”

Despite the increasing dominance of technology in our everyday lives, of those that do budget formally, the trusty old notepad is the most popular method, with 22% budgeting using a notebook or some other note making with women (28%) much more likely to use this method than men (15%).

The next most popular method was via a spreadsheet on the computer (19%); this was more popular with men (23%) than women (16%).

Keeping the balance

As well as studying people’s budgeting habits, the research also looked into how we check our bank balances, either online or in branch and found that more than a third (34%) check several times a week and more than a quarter (26%) check weekly.

Happy planning

SunLife’s research has also revealed a strong correlation between happiness and budgeting and happiness and balance checking. Those who budget are happier than those who don’t, especially those who budget online who are happier than those who don’t budget - while those who check their bank balances regularly are happier than those who don’t.

Dean Lamble, managing director of SunLife concludes: “With UK personal debt now standing at 112% of average earnings and UK households saving just 4.9% of their incomes (the lowest proportion since 2008)1, we should be keeping a close eye on our finances, but the shocking truth is that less than half of us formally budget with many people admitting they have little or no idea how much money is coming in and out.

“What is interesting, however, is that the vast majority of us are checking our bank balances regularly, with 23% checking them daily, 34% several times a week and 26% weekly; this maybe suggests that easy access to our accounts has taken over from formal budgeting for many people.

“But whether you prefer the trusted pad and paper or are more technologically inclined our research shows that those who budget in some way, either formally or informally, are happier than those that don’t, so it is worth keeping on top of your finances, not just for your financial well-being, but your personal happiness too!”

Ends

1.The Money Charity - The Money Statistics September 2015

Here's the information that you need to know about who we are and the other companies that we work with in order to provide our products and services.

Who are SunLife? 

Phoenix Life Limited trades as SunLife and is the provider of the Guaranteed Over 50 Plan, SunLife Insurance and the life insurance policy payment option for Funeral Plans. Phoenix Life Limited’s registered office is at 1 Wythall Green Way, Wythall, Birmingham, B47 6WG (registered in England, no. 1016269). Phoenix Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority and is entered on the Financial Services Register (registration no. 110418). As part of SunLife’s commitment to quality service and security, telephone calls may be recorded.

SunLife Limited distributes financial products and services and is a company limited by shares, registered office: 1 Wythall Green Way, Wythall, Birmingham, B47 6WG (registered in England, no. 05460862). SunLife Limited is authorised and regulated by the Financial Conduct Authority and is entered on the Financial Services Register (registration no. 769427).

You can contact us by post at SunLife, PO Box 1395, Peterborough, PE2 2TR or by phone on 0800 008 6060.

If you choose to add Funeral Benefit Option to your Guaranteed Over 50 Plan the funeral services are arranged and provided by Dignity Funerals Limited. Dignity Funerals Limited is a company registered in England and Wales No. 00041598. VAT registered No. 486 6081 14. 4 King Edwards Court, King Edwards Square, Sutton Coldfield, West Midlands, B73 6AP. Telephone No. 0121 354 1557. Fax No. 0121 355 808. Part of Dignity plc. A British Company. Dignity are not regulated by the Financial Conduct Authority or the Prudential Regulation Authority but are registered providers with the Funeral Planning Authority.

Who provides the Funeral Plans?

The funeral services are arranged by a funeral director selected by Golden Charter Ltd. Golden Charter Ltd are not required to be authorised or regulated by the Financial Conduct Authority or the Prudential Regulation Authority in relation to funeral plans but are registered providers with the Funeral Planning Authority.

If you choose to pay for your funeral in one go, with a single payment, you will have a contract with Golden Charter. The funeral services will be arranged by a funeral director selected by Golden Charter Ltd.

If you choose to pay for your funeral with a life insurance policy, the policy will be provided by Phoenix Life Limited, trading as SunLife. The funeral services will be arranged by a funeral director selected by Golden Charter Ltd.

Who provides My Smarter (ISA)?

My Smarter (ISA) is provided by Scottish Friendly Asset Managers Limited. Authorised and regulated by the Financial Conduct Authority. Details can be found on the Financial Services register, registration No. 188832. Member of The Investment Association. Registered Office: Scottish Friendly House, 16 Blythswood Square, Glasgow G2 4HJ.

Who provides the Will writing services?

Hugh James is authorised and regulated by the Solicitors Regulation Authority (SRA Number:303202).

The information contained on this website is based on Hugh James' understanding of the law of intestacy in England and Wales only as at April 2014. The law in Scotland and Northern Ireland is significantly different. This is for information purposes and is not intended to be legal advice.

Who provides Family Life Insurance?

SunLife Family Life Insurance is provided by Scottish Friendly Assurance Society Limited which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Details can be found on the Financial Services register (registration number 110002). Registered Office: Scottish Friendly House, 16 Blythswood Square, Glasgow G2 4HJ. 

Who provides SunLife Pet Insurance

SunLife Pet Insurance is arranged and administered by BDML Connect Limited. BDML Connect Limited is authorised and regulated by the Financial Conduct Authority (No. 309140). Registered in England and Wales Number 02785540. Registered Office: 45 Westerham Road, Bessels Green, Sevenoaks, Kent, TN13 2QB.

Who provides SunLife Home Insurance

SunLife Home Insurance is arranged and administered by BISL Limited and underwritten by a panel of insurers. BISL Limited are an intermediary authorised and regulated by the Financial Conduct Authority. Registered in England no. 03231094. Registered office Pegasus House, Bakewell Road, Orton Southgate, Peterborough PE2 6YS.

Who provides SunLife Car Insurance

SunLife Car Insurance is arranged and administered by BISL Limited and underwritten by a panel of insurers. BISL Limited are an intermediary authorised and regulated by the Financial Conduct Authority. Registered in England no. 03231094. Registered office Pegasus House, Bakewell Road, Orton Southgate, Peterborough PE2 6YS.