Rising Living Costs and How to Beat Them
19th January 2022
You’ve probably been hearing a fair bit recently about the rise in the UK’s “cost of living”. Obviously, this is something that affects all of us, so it’s worth taking a moment to look at what’s actually going on here.
January, traditionally speaking, is a time when we all feel the pinch in our pockets a little more sharply. We’ve crashed headlong into a new year, with most of us still dragging the weight of our Christmas (over)spending behind us. Now that the festive fairy-dust’s settling a bit, we’re starting to get a clearer picture of how much more the “most wonderful time of the year” cost us in 2021 – along with what that means for the months ahead.
Overall, it’s looking like UK households had to stump up an extra 3.5% in December 2021 for their grocery shopping. Not counting the initial COVID-19 panic-buying spree, that’s the steepest ramp-up in prices since the start of 2018 and means a jump of around £15 in the average monthly food bill.
Of course, there’s more to the overall cost of living than food prices. The big, gassy elephant in the room right now is the skyrocketing price of energy. Literally dozens of suppliers have gone bust in the last year, and estimates suggest we could be looking at an average increase of around £600 in our yearly energy bills from April. The cost of travel’s on the rise as well, with rail fares leaping up by 3.8% in March and the price of filling up a typical fuel tank is already topping last year’s cost by £16.
Beating the cost
So, is there any good news at all this year? Well, surprisingly, yes. Depending on what you’re shopping for, there are actually a few household costs that are coming down at the moment. A drop in the price of flour, for instance, is having quite a few knock-on effects on the supermarket shelves. Fresh fish is down by about 1% too, along with smoked, dried and salted meat products.
Outside of food and drink, we’ve also seen a drop in the cost of things like contents insurance - which is down by almost 7%. There was also a 4.4% drop in the cost of motor cover, but the new rules against ramping up rates for loyal customers will probably see prices take off again soon.
As for what this all means, it’s going to be more important than ever for most of us to keep control of our costs, debts and spending. The rising cost of energy is going to be painful for almost everybody, for example, but there are still ways of bringing down the damage by hundreds of pounds (see our articles “6 Easy Ways to Save on Gas and Electric Bills” and “Save Money with These 7 Simple Heating Bill Hacks” for more on this).
The main thing to do to tackle the cost of living crisis is to claim back the tax you’re owed by HMRC. We’re talking about a yearly pay-out of around £900 for a typical tax refund claim – and it’s all going to waste if you don’t claim it back. Remember – a tax refund isn’t some kind of hand-out or benefit you can claim.
Use our free tax refund calculator now to see what you're owed. It only takes a couple of minutes and it could make a big difference to what you've got in your wallet. You can claim up to the last 4 years back at once.
It’s literally your money left sitting in the taxman’s hands when you pay for work travel and other essential out-of-pocket expenses. Only 1 in 3 UK workers ever get back what they’re due, but RIFT works every day to change that. Get in touch, make your claim and let’s kill off the cost of living crisis together!