Effects of recession on spending habits

Has the recession weakened the spenders?

09:48 18 October 2014

Despite recession coming to an end and reports of good progress in terms of recovery being made, there are still some lingering effects which make us completely change the way we approach financial issues in general. One of these changes is how most of us choose to spend money.

 

Quality Over Quantity

 

People are shifting towards quality rather than quantity. Despite the hardships, people are willing to part with a good sum of money to buy a quality item rather than spend on a less quality good or service. They have come to see that investing in quality goods will save more cash in the long run.

 

Holidays are now ‘local’

 

More people are also willing to take local holidays. They have come to see that holidays are the most extravagant splurges and in most cases the effect achieved if you travel abroad on holiday will be the same if you go for a holiday closer to home. Penny pinchers therefore opt for local attraction sites and day trips which are a lot cheaper than lavish foreign tours.

 

Savings is the Way Ahead

 

There have also been increased saving rates and numbers among the young people. Maybe they are learning from the mistakes of the past generation or they want to achieve financial independence as early as possible, but whatever the reason they are dedicated to this course. With over 66% of young people of 18-24 years making monthly savings, this will definitely lead to a great shift towards self-sufficiency.

 

Play the Flexible Game

 

More consumers are becoming flexible in their shopping habits. Previously, most people would remain loyal to one shop or supermarket, one brand of clothing or service provider. However, nowadays people are exploring the available options and definitely going for the cheaper one.  This might be because of the economic crisis; but it seems like it has created more awareness in the importance of financial management.