Londoners are being more careful with their money due to Covid-19 and the effect it is having on the city’s economy.
Quizzed by ES Money and research specialists OnePoll*, 44% of those in the capital agreed and 36% strongly agreed they were being more cautious financially, which means four out of five are taking extra care of their funds.
Worryingly, 44% of respondents in London agreed or strongly agreed with the statement: “I’ve avoided spending money even on things I really need such as heating/lighting, clothing and groceries.”
With the UK fast approaching the anniversary of the first national lockdown, we asked Londoners for their main concerns, with coronavirus causing the most anxiety:
Just under half (48%) of Londoners say they are now working from home as a result of pandemic restrictions. This is bringing financial benefits, with 79% of them saying they are saving money on commuting, 54% saving on not having to buy food on their lunchbreak, and 45% not spending on takeaway hot drinks.
But it’s not all good news for the work-from-homers’ wallets. Over half (55%) say they are spending more on heating and powering their homes because they are there during working hours and because of lockdown requirements.
This is significant because any household on its energy supplier’s default or standard variable rate tariff (SVT) has a nasty shock in the pipeline.
Shock in the pipeline
The energy market regulator, Ofgem, is increasing its price cap for these tariffs from 1 April.
For a typical London household that will mean a £96 hike in annual bills. Those using pre-pay meters will also see their prices increase by £87 to £1,156 (figures are calculated for average consumption rates).
The main suppliers have said they will raise their rates to the maximum allowed by the price cap. But the good news is that households can swerve the increase by switching energy provider.
The cheapest energy tariffs tend to be fixed rate deals, where the price per unit of energy used is locked in for a stated period, usually 12 months.
Anyone on a default tariff – this will be someone who hasn’t switched for two to three years or who has never done so – is highly likely to find a cheaper deal that could save them a three-figure sum each year.
And anyone who is already on a fixed rate tariff should shop around before their current deal comes to an end so they can continue to enjoy a good value deal.
*Between 5 and 9 February 2021, ES Money commissioned OnePoll conducted a nationally representative survey of 2,000 UK adults. We have isolated the figures for London.