A fifth of earnings are spare cash
The average person in the UK has £38.19 a week in spare cash to spend however they want, according to new research by Sunlife.
Sunlife interviewed 3,000 adults and found that on average, £1 of every £5 earned is considered to be spare cash. Spare cash is here defined as the money left over each month once an individual or household has paid for their regular outgoings.
This equates to 81% of average monthly earnings being used to pay regular outgoings, or the money earned from Monday to Thursday in a typical 5 day working week.
The study found that the average household income is £1,970, which is used to pay the following:
- rent (average of £433) or mortgage payments (£450)
- credit card payments (£120)
- loans (£250)
- regular costs such as food and transport.
Once these costs have been accounted for, the household is left with £381 a month in spare cash, or £38.19 a week per adult individual.
The study also found that the amount of spare cash a person has each month is related to how happy they feel. To be in the happiest 10% of respondents, the amount of spare cash needed was £71.54 a week.
There was also a regional disparity in the amount of spare cash a person could expect to have. While London has some of the highest incomes in the country, Londoners have an average of 17% of their income as spare cash, as opposed to people in Scotland who take home 23%.
Dean Lamble, managing director at Sunlife, said:
“Perhaps the bigger story here is that it shows how beneficial it can be to budget, to try and give ourselves a bit left over at the end of every month.
“It also shows that financial happiness could be more attainable for many people than they might think, with the average person needing to find an extra £33 a week – less than £5 a day – in spare cash to be among the happiest in the UK.”