Millions of Britons have no household budget

By UK CreditCards.com

Budgeting is especially vital in times of austerity and rising living costs. But research from the Money Advice Service suggests that many consumers fail to recognise its importance.

One-third of adults 'unlikely to budget this year'
A survey of 2,175 adults, conducted by YouGov on behalf of the Money Advice Service, found that 33% of households are unlikely to set a budget to help plan their spending on rent, mortgages, travel, food, clothing and other everyday costs.

This means that more than 16 million Britons will not have a budget this year, with many regarding it as a waste of time. Almost one in five (19%) said they do not bother budgeting because they have credit cards or an overdraft to fall back on if they overspend, while 16% prefer to spend what they like, whenever they like.

Meanwhile, 17% said budgeting is a waste of time because they wouldn't stick to a spending plan anyway -- and a fortunate 32% of respondents claimed that they usually have money left over at the end of each month, making a household budget unnecessary.

Jane Symonds, head of service delivery at the Money Advice Service, said she was "surprised" by the number of people failing to make a budget.

"In these tough economic times, many people don't have much money left over after the bills have been paid, so it's really worrying how many households intend to live off overdrafts and credit cards," Symonds said in a statement. "Keeping track of your money will not only help you cope with the unexpected, but also bring peace of mind."

Benefits of budgeting
While some may be skeptical of budgets, the majority of those who do have a budget believe they benefit from the process. More than half of UK adults say their household does have a budget, and, among these budget-keepers, half say it gives them peace of mind and helps them to feel better about life. Almost one in three budgeters feel out of control if they do not have a budget, and 32% believe it helps them to cope with the unexpected.

Regional budget breakdown
Do you live in a region of budget-keepers or budget-dodgers? Use this chart to find out:

Published: 9 January 2013