How Families Can Survive and Thrive During the Cost of Living Crisis


The cost of living crisis in the UK has put considerable strain on household finances. With costs rising faster than incomes, many families are struggling to make ends meet. Raising children is always a costly affair, with experts estimating it costs around £223k to bring up a child from birth to age 18. And even then, the costs don’t stop.

The Bank of Mum and Dad is more likely to be tapped for cash than ever before. In addition, many adult children are being forced to live at home well into their 20s and 30s because rents are rising fast and young adults can’t afford to get on the housing ladder.

If you have have family, or you are caring for foster children, you might be wondering what you can do to make things easier and save money. Luckily, there are ways that families can adapt to ease the pressure and even thrive financially during this difficult period.


Evaluate Your Finances

The first step is to thoroughly evaluate your family’s finances.

Review all sources of income, including salaries, benefits, pensions, tax credits, child maintenance payments, and any other regular monies coming into the household. For example, foster carers from are entitled to fostering allowances, and families can also claim Child Benefit and other benefits.

Then, carefully examine necessary spending such as rent/mortgage, utility bills, grocery shopping, transportation costs, insurance premiums, loan/debt repayments, and other essential outgoings.

Additionally, look at discretionary spending on areas like dining out, entertainment, hobbies, holidays, and other non-essential expenses. Doing a detailed analysis of both types of expenditure will illuminate where exactly your money is being spent.

Scrutinise existing debts such as personal loans, store cards, credit cards, overdrafts, and any other debt to understand interest rates and minimum repayment terms.

Finally, calculate total savings held including easy access accounts, cash ISAs, fixed-rate bonds, shares, funds, and any other investment vehicles.

Reviewing all these elements of family finances provides crucial clarity on where money is going and opportunities to cut back, save or earn more.

For example, overspending on takeaways clearly highlights an area where costs could be reduced by cooking more economical meals at home. Having no savings indicates setting up a standing order to build an emergency fund should become a priority. The review may also uncover chances to negotiate a pay rise or switch jobs, take on overtime, monetise a hobby, rent out a room or drive for a rideshare service to boost total income.

Whatever its findings, conducting a detailed assessment lays the foundations needed to improve family finances.


Create a Budget

Once you understand where your money is going, create a detailed budget that aligns spending with your financial priorities. Account for essential costs like housing, utilities, food and transport as well as discretionary expenses. Be realistic about what’s achievable for your family and revisit the budget monthly to assess progress. Any excess income should go straight into savings.

Ideally, aim to build a savings pot that will cover a minimum of three months’ worth of outgoings. Even better, have enough money to keep you afloat for six months.

Reduce Energy Usage

Energy bills have skyrocketed, so reducing usage can result in major cost savings. Simple things like turning lights off, using appliance timers, washing clothes at cooler temperatures and taking shorter showers help incrementally.

Consider bigger investments like extra insulation, solar panels or more energy-efficient appliances to save more substantially.


Cut Back on Discretionary Spending

Take a hard look at any discretionary spending that could be reduced like buying new clothes, expensive hobbies, premium TV subscriptions and impulse purchases. Set defined budgets for these categories and stick to them. Downgrade expensive services and avoid unnecessary fees where possible. Put the money saved into an emergency fund.

Purchase Store Brands

Opting for supermarket own-brands and value ranges over expensive branded items can seriously cut grocery bills. In many cases, the quality is comparable. Shop at discount supermarkets like Aldi and Lidl and look out for money off vouchers too. Bulk buy for non-perishables to further reduce costs.


Cook at Home

Eating out and ordering takeaways is very costly, especially for families. Get creative cooking economical meals at home from basic ingredients instead. A large pot of curry can easily last 2-3 days, and making extra portions to freeze saves more money and time long term. Encourage kids to help prepare meals too.

Look for Free Entertainment

Family days out can be very expensive, so look to entertain the kids for free instead. Local parks, museums, galleries and libraries provide hours of entertainment at no cost. Set screen time limits and encourage kids to play together, make crafts and pursue inexpensive hobbies instead.

Boost your Income

Consider supplementing a main income by taking on a second job, monetising a hobby or renting out unused space in your home. Every extra bit earned takes the pressure off strained budgets. Older children could seek part-time work and contribute towards their expenses too. Flexible jobs like driving for Uber can be fitted around family life.


Reassess Debts and Loans

Pay off expensive credit card and loan debts as fast as possible, focusing on those with the highest interest rates first. Where feasible, shift debts onto 0% balance transfer cards to avoid accumulating interest. Renegotiate repayment terms on loans and store cards to make monthly payments more affordable, if needed.

Review Insurance Policies

Check all insurance policies to ensure you have the level of cover truly needed for life, health, home, cars, etc. Adjust excesses to lower premiums and cancel any superfluous policies or downsize coverage on items of little value. Every bit saved helps.

Saving and Investing

Families should build up emergency savings funds during good times to create financial resilience for challenging periods. Having cash reserves prevents reliance on expensive credit solutions during income shocks. Also, investing sustainably over time allows families to better manage life’s surprises and have options.


The UK’s cost of crisis puts families under huge financial strain but there are always solutions. Making a budget, reducing outgoings and unnecessary costs and boosting incomes helps families adapt. Building emergency savings and investing for the future leads to resilience. With pragmatism and patience, families can survive and even thrive financially in difficult times through focus, thriftiness and unity.