October 4th 2024.
According to recent research, it seems that Southampton has the highest rates of disposable income in the UK. This means that the people living there have more money left over after paying for necessary expenses compared to other cities in the country. The research, conducted by MoneySuperMarket's Household Money Index, surveyed 10,000 people across 17 different cities and calculated the ratio of income to spending on fixed outgoings such as bills, taxes, and rent or mortgage payments.
Overall, the results showed that people in the UK are generally earning more and spending less on bills compared to last year. However, this improvement in disposable income is not evenly distributed across the country. The study found that Southampton ranked at the top of the list, with residents only spending 60% of their income on fixed outgoings in the past year. This means that the average salary earner in Southampton has around £3,150 more in annual spending money compared to the national average.
On the other end of the spectrum, Liverpool ranked at the bottom of the list with residents spending three-quarters of their earnings on fixed outgoings. This means that the average Liverpudlian has £2,100 less in disposable income compared to the average Brit. The difference between the two cities is significant, with the average monthly disposable income in Southampton being around two-fifths higher than in Liverpool.
While some of these differences can be explained by variations in earnings, the study suggests that the main factor at play is the cost of living in different parts of the country. Rent, in particular, seems to be a major factor, as cities like London and Manchester have similar disposable incomes despite a significant difference in average earnings. This shows that even though Londoners earn more on average, they also have to spend more on housing, resulting in a similar amount of disposable income as those living in Manchester.
The full ranking of the 17 cities, from highest to lowest percentage of income spent on fixed outgoings, is as follows: Southampton, Belfast, Brighton, Sheffield, Newcastle, Edinburgh, Glasgow, Cardiff, Bristol, Manchester, Leeds, Plymouth, Nottingham, London, Birmingham, Norwich, and Liverpool.
Peter Duffy, CEO of MONY Group, which owns MoneySupermarket, commented on the findings, stating that people seem to have a bit more money left over for discretionary spending this year, which they are choosing to use on things like home improvements, subscription services, and gym memberships. He also noted that despite the increase in disposable income, people are still determined to find ways to save money wherever possible.
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