The Covid-19 pandemic has brought about unprecedented challenges for households across the UK. However, even before the pandemic hit, many households were already struggling with their finances.
According to a report by the Financial Conduct Authority (FCA), over 50% of UK adults were financially vulnerable in 2017. This means that they were either struggling to make ends meet or were at risk of falling into financial difficulty.
The report also highlighted that many households were relying on credit to make ends meet. In fact, around 4.1 million people in the UK were in arrears or had defaulted on a debt payment in the year leading up to the report.
One of the main reasons for this financial vulnerability was the rising cost of living. The cost of essentials such as housing, energy bills, and food had been increasing faster than wages, leaving many households struggling to keep up.
In addition, many households were also dealing with debt from previous financial commitments. This included credit card debt, personal loans, and overdrafts.
The FCA report also highlighted that many households were not seeking help for their financial difficulties. This was due to a lack of awareness of the support available, as well as a fear of being judged or stigmatized.
The Covid-19 pandemic has only exacerbated these financial difficulties for many households. With job losses, reduced working hours, and increased living costs, many households are now struggling to make ends meet.
However, there is support available for those who are struggling with their finances. The government has introduced a range of measures to support households during the pandemic, including furlough schemes, mortgage holidays, and increased welfare support.
In addition, there are also a range of debt advice services available, such as the Citizens Advice Bureau and StepChange Debt Charity. These services can provide free and confidential advice on managing debt and improving financial wellbeing.
It is important for households to seek help if they are struggling with their finances. By doing so, they can take control of their financial situation and work towards a more stable and secure future.
