Findings from our latest Snapshots survey are now available. ‘Money Matters’ looks at how optimistic UK consumers feel about their financial situation in 2015, and compares this with results from the previous four surveys.

1. Money Matters
January 2015

2. Contents
2. Introduction
3. Key Points
4. Compared to Last Year
5. Main Concerns for 2015
6. Salary Expectations
7. Debt Expectations
8. Credit Used
9. The Housing Market
10. Household Spending
12. Lifestyle
14. A £500 Windfall
15. Financial Outlook
16. Overall Optimism for 2015
17. Overall Conclusions
18. Contact

3. Our annual ‘Money Matters’ Snapshots survey collects consumers’ attitudes and
concerns relating to the overall economic outlook for the coming year and how
these impact on perceptions of people’s own personal financial situation.
This is the fifth year in which we have conducted the survey, following the initial
benchmark research in January 2011. At that time it seemed like the worst of
the economic crisis was over with almost continuous (albeit extremely modest)
growth in GDP throughout 2010. In reality the next few years proved to be
an economic rollercoaster with various predictions of when the long awaited
economic recovery would happen proving overly optimistic. However as 2014
progressed, it seemed that at last the economy was indeed on an upward
trajectory with the UK’s GDP growing at a faster rate than any of its G7 peers and
the lowest level of unemployment for 6 years being recorded. However, in the
third quarter of 2014 the recovery looked like it may be losing steam - growth in
GDP slowed, news from the Eurozone, our biggest export market, was worrying,
the government deficit remained stubbornly high and welfare payments were still
rising in real terms. Therefore from an optimistic start, 2014 ended on a more
cautious note, with speculation that 2015 may bring further spending cuts and/or
tax rises.
So given this mixed picture, what do UK consumers feel that 2015 is likely to
mean for them in terms of their personal financial situation? In order to answer
this question we interviewed a nationally representative sample of 405 UK
respondents. The survey took place online between 27th December 2014 and 6th
January 2015.
We have mainly reported on changes from 2014 to 2015 but data for the past five
years is available by contacting McCallum Layton (see the end of this report for
contact details).
Introduction
2

4. Our 2014 Snapshots showed that consumers were finally feeling more positive about their own
personal financial situation after several gloomy years. Encouragingly, it is apparent from our most
recent survey that this upward trend in optimism has continued with a significant increase from 2014
in the average optimism score (5.63 where 10=Extremely Optimistic compared to 5.14 a year ago).
Moreover, although a substantial minority are still worried about the year ahead, the proportion has
fallen to its lowest level since the survey began. The same is true of the percentage who believe that
the coming year will be a bad one for them financially. In addition, there has been a significant rise
in the percentage who agree with the statement ‘I’m better off than I was 12 months ago’ – from 21%
in 2014 to 27% this year. Reflecting the fact that many people are feeling more secure financially, the
average amount of a £500 windfall that would be saved was at its highest level in 2015 since our survey
began and the average amount that would be used to pay off debts was at its lowest level.
As in previous surveys, younger people are amongst the most optimistic about their financial
prospects, which is no doubt linked to the fact that they have greater expectations of receiving an
above inflation salary increase. Perhaps reflecting this higher level of confidence younger consumers
are most willing to take on additional debt, particularly in the form of short-term/pay day loans, as well
as spend more on non-essential items such as days out, eating out and day to day treats and luxuries,
including chocolate and confectionery.
However, it is interesting to see that the under 35s are also more anxious than older people about
certain aspects of the year ahead; they show the highest levels of concern over rising food prices,
inflation, job losses and whether they will be able to keep up with their mortgage or rent payments.
This age group is also most likely to find it difficult to move up the property ladder, with a third of
homeowners under 35 saying that current economic conditions and house prices mean they are less
likely to move this year (up from 24% in 2014) compared to only 19% who say they are more likely to
move. In addition, half of all under 35s are concerned about rising house prices, compared to just a
quarter of 35-54 year olds.
Our survey reveals as a result, this is also the age group most likely to feel that their current financial
situation is negatively affecting their health and/or happiness, with around half of all under 35s
agreeing with this statement.
Key Points
3

5. So why are some people more concerned about their financial
situation?
The main reason is consistent with previous years, with
respondents expecting prices to increase but annual income to
remain steady or even fall.
Higher bills /
energy costs
13%
37% of respondents are
more worried now than
they were one year ago –
significantly less than the
proportion seen in 2014
and the lowest figure since
our survey began five years
ago
Compared To
This Time Last Year
To begin with we asked people how worried they are about
their financial situation now compared to the same time last
year.
Just under two-fifths (37%), say they are more worried now,
significantly lower than last year’s figure of 44% and the lowest
proportion since our study began. Around half, 52%, are just
as worried about their financial situation now as they were
this time last year, while around a tenth (11%) claim to be less
worried.
Over half (54%) of under 35 year old consumers are more
concerned than last year, significantly higher than the
corresponding figure for older people.
Base: More worried about the year ahead (150)
4
More worried
About the same
Less worried
37%*
2015
2014
44%
52%
48%
11%
8%
*Statistically significant difference vs. 2014
Everything is
going up in price
18%13%
11%
7% 7%
6%
Reduced
income/pay
cut
Less Money
Risk of
redundancy /
job security
More debt/
too many
debts
Cost of living
increasing faster
than income
Unemployed/made
redundant (self or
spouse)
Why are you
more worried
than you were
last year?
Spontaneous
6%

6. We gave respondents a list of potential areas of concern for the
economic outlook over the next 12 months and asked them to
say how worried they are personally about each one.
As in previous years, the main sources of anxiety are increasing
energy and food prices and rising inflation, with the majority of
consumers saying they are worried about these issues. However,
the proportion expressing concern about each of these has fallen
significantly since this time last year and in each case is now at its
lowest level since our survey began.
By the end of 2014 unemployment had fallen to its lowest level
in six years and this change is reflected in these results as there
has been a significant decrease in the proportion saying they are
worried about public sector job losses or the loss of their or their
partner’s job.
The extent to which consumers are worried about these issues
varies by age, with under 35s being significantly more likely than
older age groups to be worried about public sector job losses,
rising inflation, rising food prices, child benefit cuts, rising house
prices, a rise in mortgage interest rates and being unable to pay
their monthly mortgage/rent payment.
Main Concerns For 2015 % Very / Quite Worried
The proportions who
are concerned about
increasing food and
energy prices and rising
inflation are significantly
lower in 2015 than last
year.
5
2015
2014
Rising energy prices
88%
Rising food prices
67%*
82%
Rising inflation
60%*
75%
Eurozone crisis
46%
48%
Public sector job losses
and their impact on the
economy
46%*
53%
Continuing low interest
rates on savings
accounts
50%
53%
Being unable to pay your
monthly mortgage/rent
payment
33%
37%
Loss of your or your
partner’s job
33%*
41%
Falling house prices
Child Benefit cuts25%
24%
A rise in mortgage
interest rates37%
Rising house prices
28%
*Statistically significant
difference vs. 2014
74%*
33%
30%
19%
23%
43%
N/A
The impact on the economy
of the Russian economic
crisis

7. Salary Expectations
Salary expectations remain similar to this time last year. Around half (52%)
of workers expect to receive a salary increase in the coming twelve months,
although only a third (34%) believe this will be above or in line with inflation.
Overall, two thirds anticipate that their income will not rise as fast as
inflation, in essence a pay cut, leaving disposable income squeezed.
Under 35s are the most positive about their salary expectations, with 14%
anticipating an above inflation increase in the coming year. Public sector
workers and those with an income below £25,000 are most likely to expect a
below inflation increase.
*Excluding those
not in work
8% Above inflation increase
26% Increase in line
with inflation
No increase 45%
Pay cut 3%
18% Below inflation increase
6

8. Given that for many, wages are unlikely to keep up with inflation, do people
expect to have to increase their level of debt?
A very similar picture is seen to last year, with around three out of ten
expecting their level of debt to increase. Half believe their debt level will
remain the same while only a fifth anticipate a fall.
Almost half (45%) of under 35 year old consumers anticipate an increase in
their debt whilst a third of those aged 55 and over expect the amount they
owe to fall.
Debt Expectations
Increase greatly
Increase slightly
Stay about the same
Decrease slightly
Decrease greatly
2015
2013
2012
The proportion of
consumers who
envisage that their
debt will increase over
the coming year has
steadily risen, reaching
its highest point of 29%
in 2015.
5% 15% 62% 10% 7%
8% 14% 56% 16% 7%
8% 21% 50% 17% 4%
7
2014 8% 19% 53% 16% 4%

9. We asked those who anticipate that their debt will increase/decrease what
type of credit they believe they will use more or less of.
The table below shows of the total sample of 405, the percentage who think
that they will increase or decrease each type of debt over the coming year.
Net scores calculated by taking the difference between those who would
increase their level of debt and those who would decrease it
Overall, a slightly higher proportion intend to increase rather than reduce
their use of credit cards, overdrafts, pay day loans and store cards in 2015,
a similar picture to 2014. The only form of credit where there is a net loss
is in the use of long term loans (1+ years). The vast majority of respondents
intending to increase their use of short-term / pay day loans were aged
under 35.
Type Of Credit Used
Credit Card
Bank overdraft
Long term loan (1+ years)
Short term / pay day loan
Store card
Increase
14%
8%
3%
4%
4%
Decrease
11%
5%
4%
1%
2%
Net
+3%
+3%
-1%
+3%
+2%
Net 2014
+3%
+6%
-
+3%
-
8

10. The Housing Market
The UK housing market saw a boom in the spring and summer of 2014,
particularly in London and the South of England, but started to slow down
towards the end of the year. Changes to the way stamp duty is calculated
appear to have had little effect on house sales and uncertainty over the likely
outcome of the general election in May 2015 will probably dampen activity
for the first half of this year. Overall, the rate of growth in house prices in 2015
is expected to be around half that seen in 2014, although it should be noted
that last year there were wide variations across the UK in the strength of the
housing market.
Respondents were asked how they feel economic conditions and house prices
are likely to affect them in 2015.
21% of homeowners and 30% of non-owners say they are less likely to move/
buy this year, which is slightly higher than the comparable percentage last year.
Only around 1 in 10 are more likely to move home/buy.
9
Home owners
Non-owners
More likely to
move / buy
9%
4%
Less likely to
move / buy
21%
30%
Net
2015
-12%
-26%
Net
2014
-8%
-17%
Around a fifth (19%) of under 35 year old home owners believe they are more
likely to move in 2015, which is significantly higher than 35-54 year olds (4%),
indicating a desire amongst younger people to rise up the property ladder.
However, the proportion of this age group who believe they are less likely
to move this year as a result of current economic conditions has increased
significantly since 2014, indicating that for many, the state of the housing
market is making it difficult for them to realise their property aspirations.
Net scores calculated by taking the difference between those who are more likely to move/buy
and those who are less likely to

11. We asked respondents about items that they expect to spend more or less
or the same on in 2015 compared to last year, grouped into two broad
categories: Essential items and Luxury/Discretionary Purchases.
Essential Items
Towards the end of 2014 wholesale energy costs were falling, but most
energy companies are failing to pass on these lower costs and many
customers do not shop around for the best available deal. So do consumers
feel they will be paying less for energy in 2015?
Overall, three out of consumers expect to pay more for their gas and
electricity in 2015, a significant fall from 69% last year, (when the 2014
survey was conducted many of the Big Six energy companies had just
announced energy price rises, leading many consumers to take out a fixed
tariff to protect themselves from future increases). A third of households
expect to pay the same but only 7% expect to pay less, the same percentage
as last year.
Anticipated expenditure on food and groceries is similar to last year, with on
balance a net 32% of respondents believing they will spend more on budget
food and groceries and a net 18% expecting to spend more on general
household food and groceries. The fact is that at the time of our 2015
survey the cost of many basic food items (such as cereals, dairy products and
sugar) was in fact falling, however this message does not seem have had an
impact on consumers who still seem to perceive rising prices to be the norm.
Under 35s are significantly more likely to say they will spend more in 2015
on budget food and groceries (54%) than older age groups.
Household Spending
Gas and Electric
Budget food and grocery brands
Household food and groceries
More
59%*
41%
36%
Less
7%
9%
18%
Net 2015
+52%*
+32%
+18%
Net 2014
+62%
+30%
+18%
The proportion who
expect their expenditure
on gas and electricity
to increase in 2015, is
significantly lower than
in 2014 (59 % versus
69%).
10
Net scores calculated by taking the difference between those who would
spend more and those who would spend less
*Statistically significant difference vs. 2014

12. In contrast to spending on ‘essential’ items, between a third and 45% of consumers
expect to spend ‘less’ on luxury items this year and the net score for each item is
a negative figure, indicating that a higher percentage expect to spend less on the
item this year than anticipate increased expenditure.
However, the net negative scores for 2015 are generally significantly lower than
those recorded in 2014 – indicating that on balance there is higher propensity to
increase spending on many luxury items than was the case last year. The greatest
differences between the two surveys emerged in relation to expenditure on ‘day
to day treats and luxuries’ and home improvements indicating that these are the
areas which are most likely on balance to see increased spending this year.
Under 35s are significantly more likely than older age groups to say they will spend
more on all discretionary purchases, with the exception of home improvements
and holidays.
Luxury / Discretionary Purchases
Alcoholic drinks in pub / club
Day to day treats and luxuries
Chocolate and confectionery
Eating out
Charity Donations
Alcoholic drinks at home
Day trips in the UK
DIY tools / materials
Holidays
Home Improvements
More
8%
11%
9%
15%
8%
11%
13%
16%
20%
20%
Less
45%
43%*
40%
44%
34%
36%
33%*
36%
38%
34%*
Net 2015
-37%*
-32%*
-31%*
-29%*
-26%
-25%
-20%*
-20%*
-18%*
-14%*
Net 2014
-45%
-45%
-39%
-40%
-32%
-27%
-28%
-29%
-28%
-26%
11 Net scores calculated by taking the difference between those who would spend
more and those who would spend less.
*Statistically significant difference vs. 2014

13. As well as investigating the effect of the economic situation on purchasing
behaviour, we questioned consumers about its impact on their attitudes and
lifestyle, by asking the extent to which they agree or disagree with various
statements.
The picture is very similar to last year, but it is encouraging to note there has been a
significant rise in the proportion feeling better off now than they did 12 months ago
and who feel more in control of their money.
As in previous years, the highest level of agreement (67%) is seen for the
statement ‘watching what I spend has become a way of life – I’ll continue when
my finances get easier.’
Some interesting variations are evident within the population. Those
under 35 are significantly more likely to agree that they are saving
more money (41%) and that they are better off now (39%)
compared to 12 months ago. Yet almost two thirds of under
35s (63%) agree that ‘having to be careful with money
is depressing so I look for little ways to treat myself’
compared to only a quarter of those aged 55 and
over. Moreover around half (51%) of under 35s
believe that their financial situation is negatively
affecting them, significantly higher than older age
groups.
Lifestyle
12

14. 2014 (%)2015 (%)
*Statistically significant difference vs. 2014
Watching what I spend has
become a way of life - I’ll continue
when my finances get easier
6767
Having to be careful with
money is depressing so I look
for little ways to treat myself
4043
I feel more in control of my
money now than I used to
3845*
I still spend more or less what I
want without worrying too much
2226
13
I’m getting really fed up of having
to be careful with money
5150
I feel my current financial
situation is affecting my
health and / or happiness
3739
I’m personally better off now
than I was 12 months ago
2127*
I’m saving more money than
I did 12 months ago
26 22

15. So what would consumers do with an unexpected £500 windfall? Would they be prudent, or take the opportunity to treat themselves or their family?
We gave respondents four options: save it; use the money to pay off debts; spend it on treats; or use it for day-to-day expenses.
The proportion that would save their windfall has steadily risen over the last four years and is now at its highest level since this survey began,
significantly greater than the other three options and significantly higher than in 2011-2013.
The percentages who would use the windfall either to pay off debts or for day to day expenses have fallen to their lowest levels, with the latter being the
least likely use of an unexpected windfall. The average amount that would be spent on treats remains largely in line with previous surveys at £104.
Non-homeowners and under 35s are significantly more likely to use their windfall for day to day living expenses.
A £500 Windfall
Respondents are
significantly more
likely to save an
unexpected windfall
than spend it on
either treats or
essentials or to pay
off debts.
Average Use of Windfall
14
2013
2012
2011
2014
2015
Save
£143
£149
£145
£176
£183
Use to pay off debts
£154
£163
£148
£140
£130
Treat themselves or family
£100
£96
£114
£96
£104
Day to day expenses
£103
£92
£93
£88
£83

16. Financial Outlook
15
So taking everything into account do people think that 2015 will be a
good or bad year for them financially?
A third of respondents feel this will be a good year for them; this is
higher than the proportion last year although not significantly so.
However it is significantly above the 2012 and 2013 figures when fewer
than 1 in 5 respondents anticipated a good year. Moreover, in 2015 the
proportion expecting a bad year has fallen to its lowest level since our
survey began, at only 17%.
Under 35s are significantly more positive than older age groups, with
43% believing 2015 will be a good year for them financially.
As would be expected, those in the lowest income bracket, i.e. earning
less than £25,000, are significantly less positive compared to those in
higher income brackets, with only around 1 in 5 (22%) believing that
2015 is going to be a good year for them as far as money is concerned.
A good year
A bad year
39%
2011 2012 2013 2014 2015
26%
16%
19%
26%
32%
40%
32%
21%
17%

17. Optimism Index
Finally we asked respondents to rate their overall level of optimism for the
coming year by giving a score out of 10, taking the state of the economy and
their own financial situation into account.
Although the average score is only 5.63, nevertheless this is the most
positive result since this study began and significantly higher than the score
of 5.14 seen in 2014.
With an average score of 6.18 under 35s are significantly more optimistic
than older age groups, and high income earners (£40,000+) are significantly
more positive (score of 6.2) than those on lower incomes.
Overall Optimism For 2015Just over half, 52%, of
people are optimistic
about the year
ahead, significantly
higher than in 2014
(41%).
34
35
15
36
30
33
22
25
32
8
10
20
Very low
(1-3)
Low
(4-5)
High
(6-7)
Very High
(8-10)
Increasing optimism
2013 (%)
2012 (%)
2015 (%)
16
22
37
27
14
2014 (%)

18. The average optimism score, at 5.63, can hardly be described as indicative
of a highly buoyant mood amongst the UK population and only around a
third believe 2015 will be a good year for them financially. It could be that
having heard predictions of a sustained recovery before, many people are
somewhat sceptical and are waiting to see what the year actually brings
before allowing themselves to feel overly optimistic. If this is the case
it could somewhat dampen the UK’s economic growth as confidence is
required in order to stimulate and sustain consumer spending.
So 2015 will be an interesting year – if the economy continues to grow,
average wages rise ahead of inflation and the prices of essentials such
as energy and many staple food items remain low, we would expect to
see a far more positive picture when we carry out our 2016 survey, with
hopefully consumers finally having faith that the worst effects of the
financial crisis are well and truly over. However, if one or more of the
potential threats we have mentioned becomes a reality during the course
of the year, this could shatter what appears from our survey to be a fairly
fragile belief that the future is indeed rosy.
2015 has begun with some encouraging positive economic statistics –
GDP is still growing and is forecast to continue to do so throughout the
year, inflation is equal to its lowest ever recorded level, average wages
are increasing albeit at a modest rate, and the labour market is predicted
to be its best since 2007, with growth in private-sector jobs expected to
outweigh cuts to public-sector roles by five to one.
As mentioned in the Introduction, there are some clouds on the horizon
most notably in the form of weaker global growth, poor economic
indicators in the Eurozone and on-going uncertainty over the future of
the single currency, magnified by the recent election of an anti-austerity
government in Greece and the continuing high level of government debt.
Despite these concerns the general consensus amongst economic
forecasters is that the overall outlook for 2015 is favourable. As a result
of higher employment and wage growth, combined with low inflation and
falling energy and food prices, many UK consumers will enjoy a higher
disposable income than they have had for several years.
However, our survey shows that whilst the positive indicators are indeed
registering with consumers, with a significant increase from last year in
the average optimism score and a drop in the percentage who are worried
about their financial situation compared to last year, people are not feeling
as confident as perhaps might have been expected.
Overall Conclusions
17

19. McCallum Layton
Bramley Grange
Skeltons Lane
Thorner
Leeds
LS14 3DW
Tel. +44 (0)113 237 5590
Fax. +44 (0)113 237 5599
www.mccallum-layton.co.uk
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Matt Counsell
Head of Quantitative Research
mattcounsell@mccallum-layton.co.uk