Brits are turning away from credit cards, getting their debts in order and heading back to the shops, suggests new research. But our financial worries are far from over - find out why here.

By Iona Bain

A monthly snapshot from data provider Markit paints the most optimistic picture of family finances for almost two years, with Brits buying more big-ticket items and relying much less on unsecured forms of credit, such as credit cards. Their demand has fallen to an 11-month low.

Major purchases hit levels not seen since the VAT hike last January, and households are also feeling the most upbeat about their financial prospects since April 2010.

But while falling inflation will make families' lives easier, Markit suggests that many will still be concerned about falling income and job losses.

Tim Moore, an economist at Markit, says: "Lower inflationary pressures are of course no silver bullet for household finances, and the strain on budgets from weak job market conditions shows little sign of abating.

"Income from employment dropped again in February, while job insecurities across the private sector were the most acute since mid-2009."

A separate survey by Lloyds TSB gave a much gloomier verdict on family finances last month - while regular debt repayments such as mortgages and credit cards rose by 1.1% from a year previously, almost one in five had no disposable cash left over once they paid their bills.

Patrick Foley, Lloyds TSB's chief economist, believes that last month's fall in inflation is yet to make a difference to personal budgets: "The competing effects of falling inflation against a weakening in the employment and income situation are set to be the dominant theme of the first half of 2012.

"The spending power report shows that in January weakening income growth has outweighed the recent fall in inflation, ensuring consumers are still being squeezed."