For Lee Putnam, lockdowns have had a silver lining: he no longer spends three hours a day in the car commuting from Chertsey to Uxbridge. He spends the extra time with his girlfriend and son; he used the money saved so far to buy a pizza oven.
“I started making pizza and I loved it,” says Putnam, 33. In a normal year, he might not have spent £400 on an Ooni gas-fired oven, but this is not a normal year.
While the economy shrank by a record amount in 2020, with an estimated one in 20 people now unemployed; for those who have kept their jobs, there’s been an upside.
Money that’s normally frittered away on daily expenses has been saved, invested or spent on big ticket items such as home improvements, art or pizza ovens.
The spike in people buying hot tubs has even caused a spate of thefts from back gardens, with insurance company Aviva warning yesterday that new owners should lock up their hot tubs when not in use.
At the start of last year, Amisa Saari-Stout and her husband Callum were renting a flat in west London. They dreamt of buying a home one day, but could only manage to save a couple of hundred pounds each month. “Sometimes commuting and grabbing lunch was £20 a day, that can add up so quickly in a month,” says Saari-Stout.
But without their commutes and gym memberships, by November they had enough to put a deposit down on a two-bedroom flat, with twice the floor space as their rented pad.
In the first lockdown we saved four times as much as we did in the same period a year before, according to the Bank of England. As a nation, last year we saved an unexpected £100 billion – or £1,500 for every man, woman and child. “People have low expenses so they are more cash rich,” says Alex Latham, co-founder of savings app Chip.
“[Our users] were saying to us that it was the first time they had ever got out of their overdraft since university,” he says.
Others have spent their windfall on improving their home. Sales of DIY goods shot up by 13 per cent in 2020, according to the Office for National Statistics. We’re “sick of staring at the same four walls”, says Sarah Coles, a personal finance analyst at Hargreaves Lansdown, who says she has spent part of her windfall on a new fence.
Interestingly, Coles says that Britons are not spending our cash quite as economists expected. In a normal recession, analysts see a “lipstick effect”: when we treat ourselves to small things to lift our spirits.
The ONS says clothing sales dropped by a quarter, and department store cosmetics by more than 40 per cent, says market research firm NPD. “Why bother with lipstick if we’re not leaving the house?” says Coles.
Susan Douglas-Scott and her wife Gerrie were looking forward to retiring in 2020. They were going to spend part of their lump sums on the holiday of a lifetime: a train tour of the Canadian Rockies, then to the Italian lakes.
Obviously, none of this went to plan. “We thought, ‘What would we like to invest it in?’” says Susan. “We had always talked about a campervan but they were expensive, but we thought why not just do it?”
They found one fitted out by Campervan Co, which cost about £32,000. It’s a hybrid, so they can go wild camping but it’s small enough that they can still park it at the supermarket.
Their windfall campervan means they can still go on UK holidays now restrictions allow.
The uncertainty of the pandemic has also demonstrated how important it is to have a nest egg. Before the pandemic, a quarter of people said that they didn’t have enough even to last them for a month if they were made redundant, according to figures from the Yorkshire Building Society.
Generation Z – those currently aged between roughly nine and 24 – are said to be the most cautious after growing up in the shadow of the Great Recession. Many of them have chosen to put away any excess, knowing that another rainy day will come at some point.
Chloe Robertson, 21, works part-time in a supermarket around studying for a degree in human biology. She worked extra shifts and, without the nights out, found herself saving money.
She downloaded an investing app, Freetrade, which says its customer numbers grew sixfold in 2020.
She split her money between sensible index funds and some riskier individual stocks. It paid off. She has so far put in about £2,600 of earnings, and has earned about £900 by making smart trading decisions. “I put as much as I could into the market and it bounced back really well – it’s been a great opportunity,” she says.
Now restaurants and pubs are open again, holidays are on their way back and people are tentatively returning to work, will we keep being sensible and saving? According to research by Hargreaves Lansdown, one in three of us will permanently go out less than we did pre-crisis, and will buy fewer clothes too.
What about the other two thirds? Even Chloe isn’t so sure this intense saving will last forever: “You’ve got to still live your life, haven’t you?” she says.