16% of people don’t know debt advice services exist

The data, coming from polling conducted by YouGov as part of the charity’s Debt Awareness Week, also suggests almost one in six UK adults – 15% – have £20 or less each month to live on after paying for essentials and eight percent have no disposable income at all.

This correlates with the StepChange’s own client data which suggests 33% of new clients have a negative budget, meaning – after a debt advice session and budget counselling – their expenses exceed their income.   

The polling also reveals the impact of nine consecutive interest rate rises on mortgage holders and renters alike, with 50% of renters and 38% of mortgage holders expecting their housing payments to rise within the next 12 months. Of those facing a rise, 26% expect to be driven into problem debt because of it, while among renters whose rent is rising, 81% say it’s because their landlord is increasing their rent. 

Additionally, the polling shows 21% of people believe contacting a debt advice organisation would have a negative impact on their credit score. 

StepChange’s director of external affairs Richard Lane said: “Millions of renters and mortgage holders are worried that simply meeting their rising housing payments is going to drive them into unmanageable debt. Inflation has skyrocketed and wages have not.  

“More than a year on from the start of the cost-of-living crisis, financial resilience is clearly very low - too many people are left with little to nothing each month after covering their basic living costs. The government must look at the whole picture and recognise the scale of this issue which is rapidly turning into a debt crisis.  

“Those on low incomes are going to receive extended support with energy bills and childcare, however, they still face punitive deductions from benefits to repay debts. Then there are those households who fall through the gaps, not eligible for government help, but still struggling to cover their living costs.  

“Many people will have built up substantial energy arrears over the past 12 months, which ought to be written off if they cannot afford to pay.”