Yahoo Finance Millions struggling to pay bills as cost of living surges
Nearly eight million people were struggling to keep up with their bills before this autumn as the cost of living surges, according to a report from the City watchdog.
The Financial Conduct Authority (FCA) estimated that 7.8 million people were finding it a heavy burden to keep up with their bills.
That was an increase of around 2.5 million people since 2020, when around 5.3 million people were finding it tough.
In total, 31.9 million people, or six in 10 (60%) of UK adults, were estimated to be finding it a heavy burden or somewhat of a burden keeping up with bills – an increase of around six million people since 2020.
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British households are facing a tough winter, with the energy price guarantee, which limits the unit cost of energy, set to last until April.
Chancellor Jeremy Hunt announced earlier this week that a Treasury-led review will be launched to consider how to support households with energy bills after April 2023.
One in four UK adults said they were in financial difficulty or said they could quickly find themselves in difficulty if they suffered a financial shock. Some 12.9 million UK adults, or around one in four (24%), were thought to have low financial resilience.
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The regulator also found that 4.2 million people had missed bills or loan payments in at least three of the six months before the survey took place.
Adults living in the most deprived areas of the country were nearly seven times more likely to be in financial difficulty than those living in the least deprived areas, the FCA said.
The research also found that 27% of Black people said they found it a heavy burden to keep up with bills, which was significantly higher than 15% of UK adults generally.
Around 12% of people in the north east and 10% in the north west of England were found to be in financial difficulty, compared with 6% in the South East and South West.
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Sheldon Mills, executive director, consumer and competition at the FCA, said: "Our research shows that people up and down the country are struggling to keep up with their bills.
"If you are facing financial difficulty, you don’t need to struggle alone. There is free debt advice available, and we have told firms that they must work with their customers to solve any problems with payment."
The findings are part of the FCA’s Financial Lives survey, with the latest research having been carried out among 19,000 people between February and June 2022. The full findings will be published in early 2023.
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A separate analysis from Which? suggests that millions of households are skipping meals or finding it hard to put healthy food on the table as they struggle with the cost of living crisis.
It comes as UK inflation returned to a 40-year high of 10.1% last month, according to the Office for National Statistics.
Groceries drove the surge as food prices shot up by 14.6% on the year – the biggest leap in the cost of food on records from the ONS since 1989. The number also exceeds the previous peak of 14.5% reached in the financial crisis of 2008.
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