Brits splash out £500 a year on major celebrations
As the nation's cake and confectionary queen Delia Smith celebrates her 70th birthday today, NS&I is highlighting the importance of financial planning to avoid a bitter-sweet experience when attending friends' and family's celebrations. With Britons currently spending around £500 a year celebrating milestone events such as wedding anniversaries, 21st birthdays, christenings and even baby showers, it is more important than ever to plan and prioritise spending and celebrations and have a ‘fun fund' to take the strain out of celebration spending.
New Savings Survey data, released today from NS&I, reveals that the majority (59%) of Britons will attend up to five such events each year. With £120 being the average cost of attending one of these celebrations, a total spend around £500 is not uncommon, and for 12% of the population who will attend between six and ten events this year the cost will be considerably more. An extreme few will be attending 20 events this year, including job promotions and housewarming parties which, when added up, could cost them over £2,400.
Tim Mack, NS&I's Savings Spokesman says: "Milestone events are special occasions where friends and families are able to come together in one place, at one time. With so many things to catch up on, funding the fun is often far from people's minds. Yet, with the amounts involved, it's important to think about where the money will come from and even set a little aside to account for it in advance."
Despite the big bills involved (which can include gifts, travel, outfits, bar bills and accommodation), many people are not thinking about these outgoings when they plan their finances. When asked how people are funding these parties, over one in ten (11%) rely on their credit card and just over two fifths (41%) use money from their current account. A further 19% of the population say they dip into their wider savings to fund the cost. 2% will even borrow money from a friend or family member to join in the celebrations.
Money seems far from people's minds as they head to parties. In fact, 17% of the population don't set themselves a spending limit. 38% do set themselves a limit but admit they don't worry if they exceed this limit.
But this can often lead to financial strain as a result and even start to spoil the celebrations. When asked how they felt about finances when attending these events, nearly a third (30%) said they worried about the cost and 20% said that they can't afford to attend every event they are invited to. Some (12%) even resent being expected to spend money to attend.
Tim Mack continues: "NS&I is keen to remind people that with forward thinking and prioritising of finances this need not be the case. Our research shows that almost a fifth (19%) of the population do not worry about their finances because they have a specific savings pot in place. We want to encourage more people to adopt this forward thinking attitude and start setting aside a small amount of money each month to go towards their own ‘fun fund', so they too can enjoy the most important celebrations without financial worries."
While £120 is the average amount people think they will spend, past experience shows it can be much more. When asked what was the most an individual had spent in the past, on average it equated to £573.23 on attending one event alone. 8% of the population said they have spent between £500 and £1,000 and nearly one in ten people (9%) told NS&I they have spent over £1,000 attending a single celebration.
And the costs may even be on the increase: half the population (50%) say they believe the cost of milestone celebrations has gone up compared with 50 years ago, and 35% of the population said people's expectations of milestone events are much higher now compared with 50 years ago.
NS&I highlights that by putting a regular amount away each month, like these fun fund savers, people will be able to afford and enjoy celebrations without worrying about the financial costs involved.
NS&I provides top tips to maximise your savings and enjoy the celebrations:
Choose which events you can attend this year. If you cannot afford to go to all of them, make a list of the ones you can attend and stick to it.
Decide the maximum amount of money you can afford to spend at each event you plan to attend. Try to plan in advance how much you will need and how much you can save each month before the event.
Set out your social calendar for the year. If you have celebrations coming up that you need to save for, try to cut down on the cost of your normal social activities.
When buying gifts for celebrations see if you can buy a gift with other family members/friends instead of buying something separately. This will help keep down the cost of the present you pay for but will also enable you all to put your money together to buy something which costs a bit more.
Look at ways you can cut costs for an event - for example do you really need to buy a new outfit or can you wear something you already own? Instead of taking taxis, look at public transport options.
Planning gifts and logistics can help to avoid last minute splurges. Book taxis/hotels in advance and make sure you agree to a reasonable price.