Consumers in the UAE plan to adjust their lifestyles by reducing household and miscellaneous expenses over the next three months, according to research by global life insurer Friends Provident International (FPI).
A survey of 880 respondents in the UAE by consultancy Insight Discovery found that 26% cite clothing as their top area of spending cuts, while 15% cite petrol spending as their top priority.
Another 9% of residents see weekend activities, dining out and luxury as the top three areas for spending cuts in the next three months.
The survey also showed that inflation was eating into the budgets of all households, whether singles, married couples without children or families. A third of singles (29%), a quarter of married couples without children, and families with families plan to spend less on clothes, followed by gas.
Some 99% of consumers support keeping their spending on mobile/broadband/TV and subscriptions, grooming/beauty products, gym memberships, home furniture and home electronics largely unchanged, with only 1% listing these spending for the top area of the cut.
However, despite their financial situation being severely squeezed by rising prices, 97% of UAE investors remain committed to saving for their future, with only 3% of them citing savings plan contributions as a top priority for reducing spending field.
‘Silver lining’
David Kneeshaw, Group CEO of FPI owner IFGL, said: “This survey shows that the cost of living crisis is starting to affect the financial well-being of people living in the UAE.
“The silver lining, however, is that while consumers are reining in their spending and re-prioritizing, most of them remain committed to saving for their future. The survey also provides an opportunity for businesses in the UAE to let They understand the challenges residents face in times of high inflation.”
Stuart Shilcock, Head of Sales at FPI, added: “Every observation of the survey provides interesting insights into what is important to UAE residents right now. Consumers themselves are having to tighten their wallets in the face of inflationary pressures.
“Having said that, competition in the UAE for wallet share is also intensifying for the remainder of 2022. Therefore, financial advisors must ensure that the productivity, value and efficiency of their products and services align with changing consumer preferences. This It’s the challenging aspect of our environment.”
