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It may seem as though the credit crunch has forced savings to the back of your mind, but according to a spokesman for National Savings and Investments (NS&I), there may not be a decrease in the number of people who are saving.

Apparently as country-wide financial worries are more widely reported, an increasing number of people feel concerned enough to start putting a little bit more money aside. The NS&I report: “One of the classic economic examples is that consumers stop spending. If you stop spending it is predominantly because you are paying off debt, or saving.”

However, during these credit crunch times more people may be looking towards paying off their debts as quickly as possible so they can look forward to becoming debt free, before they would consider saving.

The credit crunch means that there are many areas of our lives where we have to cut back on spending, and our weekly food shop is probably one of the main drainers of our disposable income. But according to Fiona Beckett, author of The Frugal Cook, credit crunch cooking can be fun!

Beckett believes that our habits-of-old meant that we were relying too much on ready meals and takeaways for the stable of our diets. But as financial times have changed, she believes that many of us will rediscover the joys of home cooking; “People are going to have to cut back as people are losing their jobs, struggling to pay their mortgages, not being able to sell a house, so it’s something more and more people will have to come to terms with. It can be really pleasurable [having to cut back]. Cooking is fun.”

The credit crunch onset seemed to happen almost overnight, which has left many Brits with no time to change their spending habits and get help to manage debt. Moneyfacts Darren Cook, head of Public Relations, said that the credit crunch has “knocked on the front door and actually affected the consumer”.

If the credit crunch happened at a much slower rate, they believe that many people would have financially reacted to the change in circumstances, meaning that many would be able to deal with their debt and not have to worry as much about financial issues being a top concern.

Cook added that “If that change had happened gradually in 12 to 24 months then people would have been able to adapt their household expenses. It’s gone from one extreme to another and it’s caught people out.”

The credit crunch has changed all of our lives in some way, meaning that many of us may feel as though we have debts that we cannot afford or that we are becoming penny-pinchers in order to make our pounds go further.

Lloyds TSB have released a Financial Face of Britain report showing that the credit crunch has shown both positive and negative trends in the way that we deal our finances. One in three of us have curbed our spending habit over the last six months so we can cope with the economic downfall.

However, due to the rising cost in living, the financial face of Britain shows how two out of every five adults are now saving less with the 45-54 age bracket having to cut their savings the most severely. In addition, over four million do not have any savings put away.

Mark Cockburn, Retail Network Director, said: “It is difficult to put money aside with rising bills and ever increasing household expenses. While everyone understands the good sense in saving, what consumers told us they need is more guidance and advice on how to save more”.

As the credit crunch continues to sweep the UK, more and more people are turning to the internet to save their cash and to help them to avoid debt.

Want to know how you can beat the credit crunch online? Read below for the One Advice top tips on how to make money, save money and beat the credit crunch:

1: Make Extra Income.
One sure fire way to beat the credit crunch is to make an extra income. Higher energy bills, food costs and the increase of general cost of living expenses means that many households have turned to the internet to make additional cash.

Peopleperhour.com is a website which brings together individuals who are seeking additional work to make this extra income. Businesses will advertise when they are looking for short-term employees for particular roles. Potential employees then bid for the jobs by offering their rate of pay and work credentials.

2: Get Some Bargains.
The High Street sales are not the only place where a bargain can be found. Savvy credit crunchers are turning to the internet to take advantage of savings all year round.

There are many ways which you can do this, from auction sites to online comparisons, it is always worth checking out the prices online before you head to a High Street store.

3. Sell Your Old Mobile.
Chances are that if you are on a contract phone you will be able to get a new handset every 12 to 18 months. Recent research suggests that UK phone users are sitting on £1.4 billion worth of old mobile phones.

Now is the chance to dig these up and sell them on. You could either do so through an auction site but it may be worth researching specialist online companies who buy old handsets to refurbish and then sell on.

4. Don’t Buy, Rent.
It is no longer just property which you can rent, you could stop buying altogether and try renting your life instead! More people are avoiding the credit crunch by renting goods and services, from luxury cars, handbags, DIY tools and jewellery.

5. Get Money for Spending.
If even the fear of the credit crunch can’t stop you from splurging your cash, then online cashback sites could be the answer to your prayers.

Some will charge a yearly fee (up to about £5) and some are free to use. The cashback websites will pay you a percentage every time you buy a product by going through their site first. There are a number of well known brands which partake in these schemes so it is really worth seeing how much of a saving you can make.

2008 was undoubtedly the year of financial doom and gloom, so the fact that ‘credit crunch‘ has been named the Word of the year by Countdown’s Susie Dent is no surprise to anyone.

Dent comments: “Specialized vocabulary is now firmly on the British public’s radar. As fears of a recession escalate, it may be productivity of the linguistic kind that is the safest bet. ‘Credit crunch’ is an example of an established term – it was already in currency back in the 1960s – being resurrected as circumstances change”.

There has also been further entries which Dent sees as important words of 2008 when it comes to describing the UK financial crisis, these include:

• Ninja Loan – A loan given to someone who has ‘No Income, No Job, No Assets’.
• Jingle Mail – Sending house keys to the mortgage company because of repossession.
• IPOD – An acronym for ‘insecure, pressured, overtaxed, and debt-ridden’.
• Homedebtor – A homeowner whose mortgage is so large that they are unlikely to ever pay it off.
• Going Underwater – Falling into negative equity.

Charities could soon suffer from the credit crunch as Britain is becoming more frugal. Research by nfpSynergy shows a direct correlation between GDP (Gross Domestic Product) and charity income since 1980.

It shows that charities have had a dip in their donations when the average disposable income has fallen. Although charities have not reported a drop in donations yet, there is an average of 15 months between the drop of disposable income and charities.

Jonathan Baker of nfpSynergy commented: “Some charities have done well during a downturn, perhaps by being very efficient and tightening their methods.” But are advising people to be aware of this trend.

Signs of the credit crunch are hitting employers, with employees preferring to be rewarded in cash as opposed to any added benefits or perks, the Institute of Employment Studies (IES) has reported.

Peter Reilly, IES director of human resources research and consultancy, said “People who are on low incomes do want the money because they need to pay their debts, and giving them gimmicks is neither here nor there.”

More employees are turning away from benefits such as additional leave, company car, health insurance and flexible working hours in return for a higher salary. Reilly says that it is more likely to be mortgage holders who prioritise their salary over benefits, due to the rising costs of living and household bills.

Struggling with Debts? One Advice can Help.

If you have a low wage and you are feeling the pinch of the credit crunch, let One Advice help. We are experts in a range of debt solutions, and no matter what your level of debt we can find a solution for you.

The credit crunch means that everyone is having to take greater control over their finances, whether it is due to worrying about how much interest your savings are earning or being worried about mouting credit card debt, it seems as though the effects of the credit crunch are inescapable.

It is now appears that the credit crunch is taking a grip over our every day life as many of us are having to put our plans on hold for 2009. Research at CreditExpert.co.uk shows that 75% of adults, the equivalent of 36 million people, are putting off life-changing moves due to the lack of available funds, including getting married or having a baby. Over half of us (55%) are now worried that we may never be able to reach our goals, such as owning our own home, due to affordability factors.

Jim Hodgkins, Managing Director of CreditExpert.co.uk, said: “There’s no doubt that uncertainty about future financial security for many people right now means putting plans on hold. One certainty is that those who are actively managing their money and understand their credit commitments can better plan for their future.”

The credit crunch is leading many to experience higher levels of stress in their job, as many are worried about losing their job due to the effects of the economic turn down.

Research by BUPA suggests that more than two in five of us have experienced higher levels of stress since the start of the credit crunch. A quarter admit to working longer hours in order to decrease the risk of losing their jobs.

Employees in both Birmingham and Bristol seem to have the greatest fear about unemployment, as their fears are five percentage points higher than the national average.

The Credit Crunch has affected each of our lives, on both a national and global scale. But the good news is that the end of the credit crunch could be in sight, according to an independent financial analyst.

Michael Baxter, economist at Defaqto predicts that oil and food prices will begin to dip in 2009, which will promote the beginning of an economic recover. A general drop in inflation will aid the credit crunch end, as this will allow prices to fall and hopefully increase a boost in consumer spending.

Baxter comments: “You are going to see the price of oil fall quite rapidly in 2009 and 2010 because people can’t afford oil at the current price… I think that is where the recovery will come, but that probably won’t be until 2010 I think.”

Government reports suggests that high oil and food prices will be around for years to come. The Treasury have warned that the rapid growth in the world economy and population, coupled with supply shortages, will stop current prices falling back in line with previous levels.

This will not make pleasant reading for families that are already feeling the pinch of the credit crunch, which has already lead to a rise in borrowing costs, utility costs and shopping bills.

The Treasury report says: “Expert views and market expectations reviewed here suggest that prices are likely to remain higher than their historical averages” and that “it will be an ongoing challenge for supply to match demand at affordable prices.”

UK wholesale gas prices have risen by 250% in the past 12 months and the average weekly shop has increased by 6%, leading to shoppers feeling the pinch during the credit crunch.

Consumer debt has soared by an additional £13 billion on the same period last year, as consumer borrowing reaches £22.4 billion in the first three months of 2008.

Unbiased.co.uk has released their Savings Break survey which showed how the credit crunch pinch means that consumer saving has fallen by £11 billion. They report that the savings break (which is the ratio between how much unsecured debt a consumer has compared with their savings) has climbed to 69p borrowed for every pound that is saved.

This is a notable increase from the first quarter of 2007, when this figure stood at 29p, thus showing how the average Brit is struggling with their debt as the cost of living continues to climb.

Chief executive of unbiased.co.uk, David Elms, said: “Consumers are playing double jeopardy – not only increasing the amount they are borrowing, but also reducing the amount they are saving. The early months of the year have traditionally revealed British consumers at their most financially stretched – the worry is that this year the scenario is even more bleak than normal. We have increased our debt two fold since the same time last year – and reduced our savings.”