Brits Turning to Cash to Manage Squeezed Budgets
A recent survey of UK households by consumer association Which? found more than half regularly use cash alongside other payment methods, while a quarter say it helps them keep track of their spending. One in five people who don’t currently use cash believe they will start using it if the cost-of-living crisis gets worse.
Our research shows that cash remains vital for many on a tight budget, and many more people could well turn to it to manage their finances as the cost-of-living crisis continues.
Which? highlights the resurgence in popularity of ‘cash stuffing’: a budgeting method making the rounds on TikTok that involves withdrawing cash on a monthly basis and dividing it between envelopes labelled with different categories such as food shopping, bills and savings. There is also the ‘1p a Day Challenge’ that sees people put aside one penny on 1 January, two pennies on 2 January and so on throughout the year. By 31 December, this will add up to £668 (around €785 or $817).
Which? also points out that, amid this renewed focus on cash, access is becoming ever more challenging for many people, with nearly half the UK’s bank branches closing since 2015—a total of 4,685—with 226 more scheduled to close by the end of 2022.
Just as cash is becoming an increasingly important tool for people to manage their tight budgets, communities are seeing their access dwindle.
The association’s call for legislation in the Queen’s Speech was answered, and now the UK awaits details of how the promised support for access to cash will be implemented. In the meantime, the nation’s Post Office service has committed to continue offering basic banking services across its network until at least 2026 to further support cash.
It is crucial that the government finally makes good on its promise to legislate to protect cash.