Three in five Brits worry they won't have enough money to make it through the year

A whopping 93% of Brits fear the cost-of-living crisis will continue to get worse in 2023 – with three in five (59%) worried they won't have enough money to comfortably make it through the year, research has found.

Panicked Brits are aiming to tighten their weekly spending budget by over a third (34%) on average in 2023, and are already seeking to cut back on non-essential items.

Takeaways are the most common “luxury” that almost two-thirds (63%) of Brits plan to slash their spending on, followed by clothing, shoes, and accessories (59%), and holidays (40%).

And the poll of 2,000 Brits, conducted by the UK's largest digital bank, Monzo, between December 22 and 29, further revealed that almost half (46%) have already cut costs by switching to shopping at a cheaper supermarket.

When it comes to savings, almost a fifth (18%) expect to put aside nothing this year, in the face of rising energy bills, higher interest rates, and needing to pay more for essential goods.

And 69% said the idea of trying to save money feels “overwhelming” at the moment – with 26% even having given up on their dreams of buying a house, as a direct result of the cost-of-living crisis.

Digital bank Monzo has offered its top tips to help Brits save smaller in 2023 (Cover Images)

However, almost two-thirds of those polled, admitted they had never heard of a savings challenge – simple budgeting activities that help people achieve specific financial goals, often in a more manageable and realistic way.

But encouragingly, those who had tried such a challenge have saved, on average, an impressive £1,700.

Sujata Bhatia, Monzo’s Chief Operating Officer, said: “Understandably, the prospect of saving is daunting for many at the moment, but it doesn’t have to be.

“At Monzo, we know that saving small amounts over a long period of time can still have a hugely positive impact on your finances.

“Monzo customers saved over £175 million last year using our saving tools and features, such as Round-ups – meaning whenever more than £1 is spent, the difference is rounded up and added to a Savings Pot automatically – and IFTTT challenges.”

Monzo has partnered with financial educator and author, Alice Tapper, who has shared her top financial tips to help people feel more empowered to save small in 2023.

The digital bank has also shared a series of ideas to help customers stay on top of their money and make it go a little further, as part of its Small Change campaign. To find out more, visit here.

Top financial tips for 2023

1. Take a look – Sometimes, the first and most important step to feeling more in control of your money, is to simply take a look at where it’s going. Some people find open banking apps helpful, as they let you see all of your accounts and subscriptions in one place.
2. Break it down – Mental accounting is a principle in behavioural economics, which means our brains find it much easier to manage our money when we break it down into categories. With Monzo, you can use “pots” to do this (they’re a bit like digital piggy banks). Some people find it helpful to open up pots for different life categories and saving goals, for example, a home renovation or their next holiday.
3. Automate your finances – The secret to sticking to your financial goals is automation. Life is busy enough, and remembering to pay bills, save money, or pay off debt, only makes it busier. Use things like standing orders and direct debits where possible, and have a go at using a saving app that helps you save without thinking.
4. Hold on to the joy – We’ve all got a thing that we would really struggle to cut out of our lives, and yet annoyingly, it’s often the first thing financial experts tell us to cut back on. Whether it’s the twice-monthly takeaway, or our coffee from that little place on the corner. As opposed to forcing yourself to avoid the things that bring you genuine joy, take 30 minutes to look through your spending, and identify the joyless, non-essential items that either you can cancel/cut completely, or find a cheaper alternative.
5. Take up a challenge – If you want to spice up your savings even more, why not start a savings challenge? There’s an app called IFTTT (it stands for “If This, Then That”), and it lets you link your Monzo account to other apps and set up rules to move your money around automatically. The 1p Saving Challenge involves saving a little money every day, starting with 1p. The next day you save 2p, the day after 3p. After a year, you’ll be setting aside £3.65 on the final day, and have a total of £667.95 in savings.