British families will need to dig deep to find an extra £1,679 a year to maintain their lifestyles and keep up with rising costs, finance experts have warned.
Retirement advisors MGM Advantage has discovered that although there was a slight drop in inflation last month, the average annual household expenditure is expected to rise to £36, 185 – nearly £1,700 extra a year. This means that collectively, households will need to find an extra £44billion over the next 12 months.
While they aren't completely off the hook when it comes to rising living costs, pensioners fared slightly better. Those whose main household occupant is aged 65 to 74 will see living costs rise to £1,092.25 a year and for older people, £697.38.
"The report is more bad news for UK families who are already struggling this year," says AOL Money editor Trisha Doyle told The Huffington Post.
"With Christmas looming four out of 10 Brits are already reining in their spending and this trend will probably extend past the festive season. In 2012, for people to survive and meet their big financial commitments in the form of mortgages, childcare and utilities bills, more frequent belt-tightening will have to become a reality."
So what can families do to fight the rising costs and stop it eating into their finances?
"Savvy consumerism can be incredibly empowering. Think about where you're spending and what you’re spending on. It might not be big spends on luxury goods but you’d be surprised the difference weekly meal planning, cutting out gym membership and ditching the daily shop-bought coffee can make. Simple cuts can have a very positive impact on your finances," advises Doyle.
"And of course, there are sensible changes you can make about your money management too. Make sure you're not being crippled by credit card interest, that you’re not paying over the odds for your current account and that you are getting a good deal on your mortgage. A few minutes spent sorting out your finances will leave you feeling a lot more in control and may even save you quite a significant sum."