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Food or fuel? For some, it`s a real question

When money`s tight, we can all have to make tough choices - but some decisions are a lot harder to make than others.

A report just published by the IFS (Institute for Fiscal Studies)has revealed that retired households spend an extra 7% on their heating when it`s very cold. What`s particularly disturbing is the fact that the poorest 25% of retired households reduce their spending on food by the same amount at the same time.

In other words, those pensioners face a `heat or eat` dilemma, in which they`re spending less on food because they`re spending more on energy.

The IFS report is called `Is there a "heat or eat" trade-off in the UK?`

It states that the IFS team `merge detailed household level expenditure data from older households with historical local weather information. We then test for a heat or eat trade-off: do households cut back on food spending to finance the additional cost of keeping warm during cold shocks?`

It found that `Statistically significant reductions in food spending are observed in response to temperatures two or more standard deviations colder than expected (which occur about one winter month in forty) and reductions in food expenditure are considerably larger in poorer households.`

A spokesperson for the IVA Advisory Centre commented: "A particularly cold winter can be a financial challenge for all kinds of households, and it`s no surprise that the poorest are the worst affected.

"We`d advise anyone in that kind of situation to talk to an expert and find out if there`s any way they could increase their available income - are there any extra benefits they`re entitled to, for example, or any cutbacks they could be making in other areas?"



The IVA Advisory Centre is a licensed Insolvency Practice, offering expert debt advice as well as IVAs and a comprehensive range of other debt solutions. If you are in debt and would like to explore your options, contact one of our advisers today.