News Article

10 million UK households 'feeling the squeeze with their finances'

Published 3 December 2012 by

New research by consumer watchdog Which? indicates that more than 10 million British households are feeling the financial squeeze - amounting to more than a third (39%) of the adult population.

Of these households struggling to make ends meet, 9% - equivalent to 2.3 million - have defaulted on a loan, bill or housing cost. 6% of households - that's 1.5 million - have resorted to using unauthorised overdrafts or payday loans to help them cover their outgoings.

Furthermore, 2.7 million households have taken to borrowing cash from friends or family, taking out credit or an authorised overdraft and cutting back in order to stay on top of their finances.

But 1.5 million (6%) are using a savings pot, as well as reducing their spending, to make ends meet in the current climate.

The latest Consumer Insight Tracker from Which? additionally found that a little under a third of people are struggling to cope on their current income. People's top financial worries are the cost of food (85%), energy bills (85%) and fuel (78%).

Ahead of the government's Autumn Statement, 68% of people are worried about future tax levels and 64% are concerned about cuts to public spending.

Richard Lloyd, executive director at Which?, said: "With 10 million households feeling the squeeze and consumer confidence low, it's more important than ever that the Chancellor is doing everything possible in his Autumn Statement to boost consumer confidence, which is vital to our economic recovery."

A spokesperson for thinkmoney commented: "In the current climate, just managing bills and other everyday costs has become a struggle for many. This makes good financial management more of a priority than ever, especially as missing bills or falling behind on debt repayments can quickly lead to more serious financial problems.

"But there are ways you could improve the control you have over your money. The thinkmoney Personal Account, for instance, is an alternative to a bank account and is designed to make sure all your monthly essentials are safely taken care of. Each month, our Money Managers will put the money you need for your important outgoings into one account, and any 'spare' cash into another.

"So, you can rest assured you won't ever be able to accidentally spend the money you need for important things - which could go a long way to improving your financial confidence in these difficult times."

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