Words About Things

Last September I wrote a post about a survey which showed that 40 percent of Britons felt that they were unable to save money due to the tough economic climate. This statistic was shocking but not unfounded, unemployment was at almost 2.5 million and the recession was hitting hard. At the time 1 in 4 people surveyed had no savings at all which left them in a very precarious state financially. Others had savings already but were unable to increase them despite the looming threat of unemployment.

Although we are now out of the Recession things are recovering very slowly and many are still struggling. Consumer confidence remains low and a ‘double dip’ recession is a strong possibility. Whilst this all seems very negative it’s not all bad news. A survey completed in July shows that we are in a slightly more positive position this year: savings accounts balances at a major high street bank actually increased by £1.4 billion in the first five months of 2010.

Some people are still unable to move money from their current account to a savings account. 62 percent of those asked said that they were saving ‘much less than they should be’ and 22 percent were not currently saving at all. The reduction in personal saving is mirrored by the reduction in consumer spending, both show that lack of consumer confidence is having a negative effect on the economy. The Bank of England will publish their August Inflation Report on Wednesday and it is expected to predict a 2 percent growth in inflation next year. This is much less than previously predicted, the outlook as been revised to to continuing economic problems.

I’m no economist but it seems to me that what we need right now is some good news. A little growth in the economy would lead to increased borrowing and spending. In turn this would lead to more growth and increased job security for those reliant on consumer spending. All it would take is for some positivity to spread and not be destroyed by another wave of bad news. I’m feeling helpful so i’ll get us started: I just found £2.50 in change down the back of the sofa…

A lot of time and effort is spent trying to work out how and why we buy in order to get us to part with as much money as possible. They layout in your local supermarket is clearly not haphazard and it’s no coincidence that the sweets and magazines are next to the till. Our decision making patterns are observed and tested so that we can be convinced not only to spend but to spend more often. Ideally (for those doing the selling) we will leave thinking that we have found a great deal or got more than our moneys worth but this isn’t necessarily the case.

We all know that something at eye level is more likely to sell than something that needs to be sought out. We also know that something priced at 99p is supposedly more likely to sell than something for £1. there are however some tricks of the trade which you may not know about:

• The second cheapest wine on the menu is often the bottle with the highest profit margin. This is because most of us want a bargain but don’t want to look cheap so we go for the second cheapest option. For similar reasons the cheapest wine on the menu probably tastes disgusting, what were you expecting cheapskate?

• By adding an extra expensive option to the menu restaurateurs are able to make a high priced option seem cheaper by comparison.

• If items are bundled together (for example a set meal) we find it difficult to work out if we are paying a fair price particularly if the items are not available separately.

• Different size portions are often sold for different prices. This means that those who are hungry will pay more and those who are trying to save money will get a smaller than normal portion. Whilst the customer feels like they are getting more of a choice they still aren’t getting more than their moneys worth.

• Coffee chains like Starbucks sell their drink in confusing sizes like Tall, Grande and Venti but never ‘small’. By taking away the relation between the names and their sizes they are aiming to make us feel like we aren’t getting a small portion or being greedy by having a ‘large’.

• The upper right corner of the menu is apparently where we all look first (eye tracking studies have proven this) so items placed here are given a lot of thought. Often an expensive and fancy option will be placed here, this makes everything else look cheaper and makes sure that this item is not missed.

During tough economic times it can become necessary to batten down the financial hatches and do away with frivolous expenses. Unfortunately this often means making your own lunches rather than the luxury of buying food each day. When I had my second job (the first had food included, or should I say ‘McFood’) I used to buy ‘gormet’ sandwiches and a coffee every lunch time which cost me about an hour’s pay each day.

These days I make my own lunches most of the time but I’m getting fed up with sandwiches and bananas. That’s why the video linked below from the Guardian site caught my eye. It explains (although not in much detail) how to make Bento Boxes:

“Bentō is a single-portion takeout or home-packed meal common in Japanese cuisine. A traditional bento consists of rice, fish or meat, and one or more pickled or cooked vegetables as a side dish. Containers range from disposable mass produced to hand crafted lacquerware. Although bento is readily available in many places throughout Japan, including convenience stores, bento shops ( bentō-ya), train stations, and department stores, it is still common for Japanese homemakers to spend considerable time and energy producing an appealing boxed lunch.”

A Bento box can be picked up from Ebay (although it can be a struggle to find one without a Hello Kitty inspired design). A simple Tupperware box with dividers will also do the job. Some of the traditional ingredients may be harder to find depending on where you live. Japanese food can be ordered online from site such as Japanese Kitchen or Mount Fuji or from your local Japanese shop if you live in a big city.

Recipes for traditional Bento fillings can be found on Just Bento and About.com’s Japanese Food section. The Guardian’s Bento article and video can be found here.

A recent survey has revealed the top 10 ways people around the country are trying to save money.  As the credit crunch (can we just call it a recession yet?) takes hold people are trying to reduce their outgoings. Here are the top 10 most popular methods shown with the percentage of people using them.

1. Staying in more (63%)

2. Shopping at cheaper shops (59%)

3. Wearing an extra layer instead of putting the heating on (51%)

4. Using loyalty and reward cards (49%)

5. Entering competitions (49%)

6. Taking a packed lunch to work instead of buying lunch (47%)

7. Using the internet to get a bargain (44%)

8. Selling unwanted items on Ebay or at car boot sales (39%)

9. Buying fewer magazines (34%)

10. Using cash rather than credit cards (34%)

It would seem that people are staying indoors entering as many competitions as possible whilst wearing extra layers from Primark. Interestingly 57% of those asked did not plan on giving up their broadband connection, at least until their phone line is disconnected. What was once seen as a luxury is now a necessity. Personal Finance expert Alvin Hall thinks this makes good sense:

“Broadband offers access to myriad ways of saving money – searching for the cheapest deal, selling unwanted goods on online auctions, downloading discount vouchers, entering competitions and even taking part in surveys like this one in return for cash.”