New analysis from Citizens Advice has revealed the stark reality of people’s finances as they head into the new year.
Research from the charity shows more than one in three UK adults say they’d find it difficult or impossible to cover even a £20 increase to their monthly outgoings.
This equates to 17.7 million people in England and Wales.
This figure is particularly high for some groups, including 58% for people in receipt of benefits, 57% for people on prepayment meters and 47% for people of colour.
Last month, Citizens Advice supported record numbers access to crisis support like food bank referrals and emergency charitable grants.
It warns that many more will be pushed to the financial brink in the coming months due to a triple whammy of soaring energy bills, inflation and interest rates.
People resorting to desperate measures to get by
The charity says its new analysis found one in four people (23%) have spent more money on essentials than they’ve had coming in over the last three months, with many resorting to short-term fixes to get by.
However, two in three (67%) reported they could only keep this up for less than six months without additional support.
Citizens Advice also found that overall, one in three (33%) UK adults has had to dip into their savings in the last three months to make ends meet.
More than half of this group (56%) have either already run out of savings, or expect to do so within the next three months – further highlighting the need for additional support measures to help keep people afloat.
“Worryingly 15% of UK adults have reported eating cold meals this winter to reduce their electricity costs. The impact on people’s mental health has also been profound with 28% of adults losing sleep each week over their financial situation.” Citizens Advice said.
Intervention is key
Citizens Advice says it is absolutely vital support continues to reach those on benefits and others struggling with energy costs.
It is also calling for a clear plan from the government on how to target support to those currently just about scraping by, but who could fall into hardship as the cumulative strain of rising costs takes its toll.
Dame Clare Moriarty, Chief Executive of Citizens Advice, said:
“Millions of households are at financial breaking point: running down savings, going without bare essentials and turning to food banks to get by.
“We’re already seeing record numbers of people coming to us for crisis support and this research shows people simply cannot cut back any further.
“Current government support is a sticking plaster which is quickly being exhausted due to the increased pressures people are facing.
“Without further targeted intervention, we risk another year of despair for millions of people.”