Households across the UK have been handed a £956 per month boost thanks to a 15 percent increase in spare disposable income, Asda has revealed.
Supermarket giant Asda has compiled its own report on the state of the UK’s bank accounts and has revealed that even the ‘lowest earning’ households have seen a 12 percent boost to their finances in the past month.
And average disposable income rose by 15.1 percent in May across the UK, Asda said, a boost of £31 per week, meaning households now have £239 per week to spare, or £956 a month of disposable cash to spend as they see fit.
However, despite the positives, there’s a catch: households are still £66 short of being able to pay all their bills as Asda confirmed ‘their take home pay was still not enough to cover bills and essential spending’.
Asda said: “The latest figures from Asda’s Income Tracker reveals that disposable income for low-earning households hit a near three-year high in May, following a 12.6% increase year-on-year.
“he lowest earning households recorded a 12.6% growth in disposable income in May – their strongest annual growth in almost three years.
“Average disposable income for all UK households rises by 15.1% year-on-year in May to £239 per week, hitting a 32-month high.”
Asda said the boost was driven by a drop in inflation, which sits at 2 percent from peak of 11 percent. It means prices are still going up (on top of all the previous price hikes), just not as fast as before.
Asda said the drop to inflation was coupled with ‘strong income growth’.
But the problem is that bills are still higher than people can afford, Asda said.
It added: “Despite this increase, budgets for these families remain under pressure in real terms, as their take home pay was still not enough to cover bills and essential spending, leaving them with an average weekly shortfall of £66.”
Reacting to this month’s Income Tracker, Pushpin Singh, Senior Economist at Cebr, said: “The Income Tracker continues to improve, with discretionary income increasing to £239 per week.
“This improvement continues to be driven by several factors, not least elevated nominal earnings growth, easing inflation, the uplift in the National Living Wage, and tax policy changes. Cebr anticipates spending power to see further improvements in 2024, bolstered by the relatively strong growth momentum seen in Q1 2024.”
