| 10.1°C Dublin

Clothes top of list for spending cuts - report

IRISH people are planning to cut back spending on clothes more than anything else in the coming year, new research shows.

Mobile phones, holidays, groceries and then electricity are the next most popular targets for savings, the survey by building society EBS reveals.

But the study also suggests almost half of Irish people have no plans to draw up a household budget to help them save and pay their bills.

Aidan Power, head of marketing at EBS, urged customers to use this month to work out their likely income and outgoings throughout the year so they can determine how much money they will have left over to save or spend.

"Effective planning can ensure that you are availing of the most favourable savings rates available and are able to access funds as and when you anticipate needing them," he said.

The research, which involved 1,000 people, showed 18pc of those polled will do a very thorough review of the finances for the year ahead, 36pc will make a general savings plan and 45pc have no plans to develop a household budget for 2012.

Of those planning to prepare a budget, more than half said it was something they have only started to do since the downturn.

The report also found:

- 29pc of those polled were saving for something specific this year, with women more likely to know what they are saving for (33pc) than men (25pc).

- Holidays topped the poll for reasons to save, with almost one in four putting money aside for a break.

- Around one in 10 were saving for a car, education fees, home improvements, a wedding, engagement or a new house.

- Some 2pc said they were putting money away for the Euro 2012 soccer championships.

"We have found that the people that set themselves savings goals tend to have more success than those that save 'for the sake of saving'," said Mr Power, launching an EBS savings campaign.

"Irish people have developed a strong saving ethos over the past number of years and what this campaign hopes to achieve is to encourage people to plan what they are saving for at the start of the year, and then they can avail of the most suitable savings products and services to meet their needs.

"By doing this they can benefit from the strong savings rates currently available in the marketplace."

Separate research by the National Consumer Agency (NCA) shows almost one in three people said not having enough money to meet everyday expenses was their number one financial concern for 2012.

A fifth of those surveyed are worried that they may not be able to meet unexpected expenses.

Ann Fitzgerald, chief executive of the NCA, said: "These findings highlight the very real concerns that some consumers have about their finances.

"If you find managing your personal finances daunting and find it difficult to know where to start, we have an online four step guide available at www.nca.ie."

PA Media