Britain’s economy is slowing according to figures for the three months up to July, showcasing why firm control of spending is required.
The National Institute of Economic and Social Research said a lack of industrial output was to blame for the slowdown – growth was at its slowest rate for a year.
According to the think tank, the UK’s gross domestic product rose 0.6% between May and July, a slowdown from an increase of 0.8% between April and June.
NIESR did improve their economic growth forecast for 2014 in the wake of the latest figures, raising their growth estimates from 2.9% in the last quarter to 3%.
Industrial output was the major limiting factor in the last quarter, growing by just 0.3% – less than half of what economists had predicted.
The need for caution
In terms of output per person, the sector might not recover to pre-financial crisis levels until 2017, with weak productivity a major factor.
“While the economy regained its pre-recession size recently, a significant output gap remains,” stated the NIESR.
While the slowdown is nothing to be too concerned about given the overall picture of the economy, it does highlight the need for regular consumers to carefully manage their spending.
Finances are not readily available and wage increases remain low, so keeping money for essentials such as bills and living costs remains a priority.
A rise in interest rates will also occur at some point in the future, expected in the early part of 2015, so funds should also be managed with such a change in mind.
Planning ahead and managing funds
While the Bank of England is in no great rush to raise rates, such a change will see an increase in everyday costs.
For anyone looking to rein in their spending, prepaid cards could be an option as only funds on the card can be spent.
The cards can be used in a similar way to a debit card – capable of withdrawing money from ATMs and from purchasing goods both in-store and online.
They can be topped up if necessary but limiting funds on the cards can mean more money is available for more essential living costs.
Security can also be added to some cards in the form of a chip and PIN, while a prepaid card is not directly linked to a bank account, reducing the risk of fraudulent activity.