Britons are predicting a tough year ahead after a surge in those seeking help from a professional debt advice website, a charity has reported.
More than two in five (43 percent) people think their household financial situation will worsen in 2024, researchers showed.
Nearly 1,000 people accessed debt advice on its website on Christmas Day in 2023, more than double that of the nearly 400 who sought help on the same day in 2022, StepChange Debt Charity found.
A YouGov survey for StepChange found that nearly half (46 percent) of people said their overall financial situation has deteriorated over the past two years.
And nearly a fifth (19 percent) of people said their financial situation has got much worse, showing that the cost-of-living crisis is far from over.
Nearly half (49 percent) of people said they are worried about their current financial situation – but only four percent who are worried about money said they had sought help from a group such as StepChange or Citizens Advice.
Vikki Brownridge, CEO at StepChange Debt Charity, said: “January is always a busy time for us as a charity, and we know that it’s not just Christmas that has stretched people’s budgets this year, but almost two years of a long and challenging cost-of-living crisis.”
YouGov surveyed more than 2,000 people across Britain in December for StepChange. Some people registered for breathing space from their debts in the run-up to Christmas.
The Insolvency Service said on Tuesday that the number of breathing space registrations across England and Wales in December 2023 was 15 percent higher than in the same month a year earlier.
Some 5,769 registrations were recorded. Within the total, 5,657 were standard breathing space registrations, which is 15 percent higher than in December 2022, and 112 were mental health breathing space registrations, which is four percent lower than the number in December 2022.
A standard breathing space is available to people with problem debt and gives legal protections from creditor action for up to 60 days.
A mental health crisis breathing space is available to someone who is receiving mental health crisis treatment. It lasts as long as the person’s mental health crisis treatment, plus 30 days.
Nicky Fisher, president of insolvency and restructuring body R3, said: “The year-on-year increase in the number of people entering a breathing space suggests that demands for debt support are still high, but that people aren’t reaching the point where they need formal personal insolvency support.
“December is always a difficult month financially – and this one was no different. Many people were considering cutting their spending back to pay for Christmas, or had already saved or considered borrowing money to pay for it.”
A survey from Tesco Bank meanwhile indicated that nearly half (49 percent) of UK adults have some form of non-mortgage debt, such as credit cards, informal loans from friends or family, or buy now pay later products.
On average, people with this type of debt said they owe £4,340. Nearly a third (32 percent) of those surveyed with non-mortgage debt expect to carry some debt into 2025.
Ban Mahsoub, spend and save director at Tesco Bank said: “Debt is something that many of us manage in our day-to-day lives and January is often the time when we try to get on top of our finances. And that’s especially true if it’s causing any stress or anxiety.
“It’s important to check your current financial picture, identify any areas of concern, spot where any unexpected spending might crop up, and make a plan to manage your money through 2024. And if you think it will take you into 2025 to pay off your borrowing, this plan is even more crucial.”
Some people may find they can cut the cost of their debts by consolidating them or looking at zero percent balance transfer options on credit cards. Individual circumstances will vary.
Opinium Research surveyed 2,000 people across the UK in October and November for Tesco Bank.
