[INSIGHTS] : Cost of living trends

The impact of the rising cost of living on individuals seeking help from National Debtline in the UK is concerning. A recent report highlights the challenges faced by callers, including falling behind on bills, increasing debt levels, and reliance on credit. The document reveals the worsening trends in affordability and financial difficulties.


Key Summary Points

  • Rising cost of living has strained household budgets, leading to many UK households going without essentials.
  • National Debtline clients, particularly those with low incomes, face serious difficulties due to increasing council tax, energy, and food bills.
  • Clients have existing debts that have grown, and they are cutting back on essentials to make ends meet.
  • Rent hikes as interest rates rise pose a risk to callers living in rented accommodation.
  • Common priority debts include council tax, energy, and benefit overpayments.
  • Average priority debt level among clients has increased by 54% since 2018.
  • Clients have fallen behind on household bills, especially energy, council tax, and food.
  • Use of credit to cover essential costs has risen.
  • Clients frequently go without essential items like food and toiletries due to affordability issues.
  • Worries about future affordability of energy bills, food, and council tax are prevalent.
  • Financial pressures caused by the cost of living crisis are likely to persist.
  • Clients’ situations are becoming more complex, making it harder to balance essential needs with debt repayments.

Key Takeaways

  • Affordability crisis: Increasing numbers of households are struggling to afford essentials.
  • Growing debt burdens: Average priority debt levels among National Debtline clients have surged.
  • Falling behind on bills: Clients are experiencing difficulties in paying energy, council tax, and food bills.
  • Reliance on credit: Borrowing to cover essential costs has become more prevalent.
  • Future concerns: Worries about future affordability and financial stability persist.
See also  [INSIGHTS]: Financial Conduct Authority's Guidance on Consumer Duty in Retail Financial Markets

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