It should not come as a surprise that in 2023, the most popular personal finance topic in Ireland revolves around the impact of inflation and the rising cost of living on consumer behavior. This trend has been highlighted in the Irish Consumer Insights Pulse Survey 2023 conducted by PwC.
The survey reveals that 79% of Irish consumers have altered their non-essential spending in the last six months due to the re-emergence of inflation after decades of very low levels. Irish consumers are becoming more cautious and mindful of cost and value in response to these cost-of-living challenges.
To cope with the rising prices and cost of living, consumers are shifting their consumption habits both in-store and online. According to the survey, 98% of Irish consumers plan to adopt cost-saving behaviors over the next six months. These behaviors include buying retailers’ own brand products, shopping with retailers offering better value, buying products only when they are on promotion or special offer, and switching to cheaper brands.
The survey also reveals that almost half (45%) of Irish consumers are extremely or very concerned about their personal financial situation. This concern has led to changes in non-essential spending, with 79% of respondents indicating that they have altered their spending habits. In fact, 15% have stopped non-essential spending altogether.
Looking ahead, the survey predicts that expected spending increases over the next few months will be less than last year in areas such as home improvement, travel, fashion, home entertainment, health and beauty, and luxury/designer goods. However, nearly half (47%) of respondents expect to increase spending on groceries.
According to CSO.ie, the inflation rate for October 2023 in Ireland was 5.1%, and it is expected to decrease due to the fall in energy prices. The average inflation rate for the year 2023 in Ireland is projected to be 6.75%.
Understanding the relationship between inflation and investments is crucial for making informed financial decisions. Inflation can erode the value of investments, making it important to have strategies in place to protect one’s portfolio. Some ways to hedge against inflation include investing in gold, commodities, property, stocks, and seeking higher interest rates for savings. It is advisable to consult with a financial advisor or conduct thorough research before making any investment decisions.
In conclusion, the impact of inflation and the rising cost of living is the most popular personal finance topic in Ireland in 2023. Irish consumers are adjusting their spending habits and seeking cost-saving measures to cope with these challenges. While concerns about personal financial situations persist, there are strategies available to protect investments and mitigate the effects of inflation. It is important for individuals to stay informed and make prudent financial choices in these uncertain times.
