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How Britain feels about debt and the recession

By Lucy Bower

25 July2021

Debt, falling incomes and dissatisfaction - this is Great Britain in the recession, according to research by consumer group Which?.

The first of this consumer group's quarterly reports into British personal finances paints a gloomy picture of how we feel about our money and how we are coping in the recession. Three quarters of us apparently describe the economy as 'poor' and half of the population thinks the situation will get worse before it gets better.

The Which? Quarterly Consumer Report suggests that many incomes have fallen and we are experiencing worsening standards of living as a result. The upshot is that only 53% of people could say they are satisfied overall with their life at the moment.

Among the findings of the research:

. Most struggle to save 7p in the pound and are becoming more vulnerable to financial setbacks in the future.

. 48% would struggle to cope with an unexpected cost.

. 35% are struggling on their current income.

. 18% used an authorised overdraft in the last month and 3% took out a payday loan.

. 18 to 29 year olds have the most debt on average - 47p in every pound of income.

. Those earning up to 12,376 have the highest debt to income ratio - 37p in every pound.

. The national average debt is 21p in every pound earned.

. People earning between 12,376 - 21,424 per year have seen biggest drop in quality of life.

. 43% will cut back on spending in the coming months.

Perhaps unsurprisingly, people who are struggling spend the equivalent of a week every year worrying about money.

A spokesperson for Think Money commented: "Many people are finding things difficult in the current economic climate, but if you are having debt problems, speaking to a debt expert about your options could help."

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Tags: debt, recession, cost of living, money worries, debt help

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