We offer the following tips to help with spending and saving decision making post-lockdown
Lockdown gives brits time to weigh up big spending decisions
- As shops start to reopen people will have spent 22 days deciding what car to buy, 19 days on furniture and nine days deliberating household appliances
- Young people are more impulsive when it comes to making decisions meaning they could be quickest to spend post-lockdown
- Lockdown has lasted long enough for Brits to make decisions on marriage and children
- Behavioural psychologist comments on how coronavirus has changed the way Brits make decisions
High street shops, department stores and shopping centres are due to reopen today/this week as the Government eases lockdown measures. Physical retail therapy may be a welcome relief among those who saved money during the lockdown, with Brits estimated to have saved £57bn over the course of the lockdown1.
With lockdown lasting 85 days, Brits have had more time than usual to mull over both spending and life decisions. Our new research2 finds Brits typically spend 22 days deciding what car to buy, 19 days deciding what furniture to buy for their home and just over a week (nine days) deliberating on what household appliances to buy.
With lockdown lasting almost three months, shoppers will have spent longer than usual weighing up purchases, leading to potentially less impulsive spending now that many shops are re-opening.
Young people set to lead the charge when it comes to post-lockdown shopping
Young people are much faster decision makers when it comes to buying new products, suggesting they might be quickest off the blocks when it comes to shopping post-lockdown.
When purchasing a new car, 18-24 year olds spend less than two weeks on this decision (13 days) compared to the 26 days taken by those aged 55+. For household appliances, 18-24 year olds spend just four days while those aged 55+ spend 11 days.
Professor Adrian Furnham, a behavioural psychologist, comments:
“Some people will be first in the queue when shops re-open, looking to finally enjoy some normality. A number of us will have spent the last few months thinking about how to spruce up our homes and what we want to buy when we get the chance. While the lockdown has been psychologically and socially tough, it may have actually helped us make some fully informed decisions as we’ve been unable to rush into anything.”
While some people will have taken a big financial hit over the last few weeks, others may have saved by staying at home, not having to commute or pay for childcare. Among those that have saved, there is likely to be an initial surge in spending as we purchase items we’ve been waiting months to buy, however it’s important to not go overboard.
It may be tempting to spend additional savings soon after lockdown lifts, however the pandemic has proven financial challenges can arise quickly and seemingly from nowhere. As lockdown lifts, we should find the balance between prioritising essential purchases while also maintaining some of these savings where possible.
Important life decisions
The lockdown could have also given people the opportunity to consider important life decisions. For instance, on average people spend 84 days deciding whether to start a family - a similar amount of time the nation has spent in lockdown (85 days). Likewise, people spend 73 days deciding whether to get married or not and 51 days whether to change jobs.
Professor Adrian Furnham comments:
“Ordinarily we live such busy lives that we often don’t have time to stop and reflect on some of life’s important and more meaningful decisions. The lockdown may have forced many people to take the time needed to reflect and evaluate whether they want to move, switch jobs or start a family. We may therefore see a rise in decisive action when it comes to life’s big events as normality slowly starts to resume.
“In the long-term the pandemic has proven you never know what’s around the corner. It’s likely people may emerge from lockdown with a new approach to decision making - seizing opportunities and acting on life decisions sooner rather than later.”
All information given including prices, yields and our opinion is correct at the time of publication. Our opinions on investments can change at any time and for our latest view please go to www.share.com. To understand how our Investment research team arrive at their views please read our Investment Research Policy.