London Daily

Focus on the big picture.
Monday, Oct 06, 2025

Cost of living crisis is 'top concern' for families as stress over financial distress intensifies

Cost of living crisis is 'top concern' for families as stress over financial distress intensifies

There are some important messages for those worried about the state of their finances as a series of reports warn about the effects the growing cost of living crisis is having on mental health, as well as bank balances.

Households are being urged to get their finances in the best shape possible amid increasing evidence of increased stress over the growing cost of living crisis - now said to be the main concern for people across the UK.

A debt advice charity told Sky News it was helping thousands of new clients navigate problem debt as families grapple rising bills across the board - a situation that is tipped to only accelerate as the year continues.

The Bank of England was particularly gloomy last week when it predicted the economy was now at risk of entering recession.

It saw inflation potentially rising to a 40-year high, above 10% by the year's end, when a further big hike in the energy price cap is expected to be implemented.

Three reports released on Wednesday highlighted growing anxiety, as the government resists demands to splash the cash and provide further financial relief.

The National Institute of Economic and Social Research estimates 1.5 million British households, one in 20 of the total, will soon face bills for food and energy which will exceed their disposable income after housing costs. It also forecasts the UK entering a recession in the second half of the year.

Meanwhile a survey by the consultancy BritainThinks found the cost of living was now the dominant concern for UK households, with 90% worried about the effects of rising prices.

It also suggested that almost half were driving less or using less gas and electricity at home to limit the impact from record wholesale prices - exacerbated by Russia's war in Ukraine.

More than of half those questioned were already buying value ranges.

The report said that 10% of people were already struggling to stay afloat and "very pessimistic" about affording essentials in the months ahead.

A separate study by Shawbrook Bank showed that 18% were already losing sleep over the issue and a quarter said that managing their finances was their leading cause of stress.

Both surveys found more than a third were cutting back on things such as days out and fashion - in line with data from industry groups that non-essential consumer spending is slipping back to take a toll on growth.

What can I do to help myself?


Debt charity StepChange said it was important that families took a good, hard look at their finances rather than just spend less - and, importantly, take action.

"If you're behind on your bills, talk to your creditors - if they don't know you're struggling they won't be able to help.

"You might be able to negotiate a payment plan with your bank, or take advantage of a grant that can pay off some or all of a utility bill," it advised.

The charity also urged those in debt to check they were getting all the help they were entitled to.

Its head of media, Sue Anderson, added: "For some struggling, however, these tips won't be enough to clear mounting debts, and that could be a sign of the need for debt advice.

"Don't worry if this is the case, you're not alone. Many people who come to StepChange struggle alone for months or even years, then tell us they wish they had contacted us sooner."

It spoke up as a third report on the issue warned of the projected effects of the cost of living crisis further down the track.

Work published by Yorkshire Building Society found that the average household could be left around £100 per month short of what they need to cover their spending in two years' time when projected wage increases were compared to those for spending.

Mixed messages


The government, which disappointed business groups and unions on Tuesday when it failed to announce immediate new measures to help working families in the Queen's speech, has signalled that more financial assistance is imminent.

The PM told MPs in the Commons: "We will continue to use all our ingenuity and compassion for as long as it takes.

"My Right Honourable friend the Chancellor (Rishi Sunak) and I will be saying more about this in the days to come."

It is not clear what form the aid will take but the Treasury has made it clear there are no plans for an emergency budget.

Comments

Oh ya 3 year ago
Well aren't you happy now that the worlds central banks printed trillions of dollars making the ones you had in your wallet worth less. Yes central banks gave you the inflation you are enjoying now and since they also kept the interest rate at a stupid low you borrowed money and can not pay it back. Thsts what happens when the government and lots of the people have no idea about financial affairs, oh ya the stock market is starting to crash. Buckle up folks

Newsletter

Related Articles

0:00
0:00
Close
Three Scientists Awarded Nobel Prize in Medicine for Discovery of Immune Self-Tolerance Mechanism
OpenAI and AMD Forge Landmark AI-Chip Alliance with Equity Option
Munich Airport Reopens After Second Drone Shutdown
France Names New Government Amid Political Crisis
Trump Stands Firm in Shutdown Showdown and Declares War on Drug Cartels — Turning Crisis into Opportunity
Surge of U.S. Billionaires Transforms London’s Peninsula Apartments into Ultra-Luxury Stronghold
Pro Europe and Anti-War Babiš Poised to Return to Power After Czech Parliamentary Vote
Jeff Bezos Calls AI Surge a ‘Good’ Bubble, Urges Focus on Lasting Innovation
Japan’s Ruling Party Chooses Sanae Takaichi, Clearing Path to First Female Prime Minister
Sean ‘Diddy’ Combs Sentenced to Fifty Months in Prison Following Prostitution Conviction
Taylor Swift’s ‘Showgirl’ Launch Extends Billion-Dollar Empire
Trump Administration Launches “TrumpRx” Plan to Enable Direct Drug Sales at Deep Discounts
Trump Announces Intention to Impose 100 Percent Tariff on Foreign-Made Films
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Singapore and Hong Kong Vie to Dominate Asia’s Rising Gold Trade
Trump Organization Teams with Saudi Developer on $1 Billion Trump Plaza in Jeddah
Manhattan Sees Surge in Office-to-Housing Conversions, Highest Since 2008
Switzerland and U.S. Issue Joint Assurance Against Currency Manipulation
Electronic Arts to Be Taken Private in Historic $55 Billion Buyout
Thomas Jacob Sanford Named as Suspect in Deadly Michigan Church Shooting and Arson
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
New York Man Arrested After On-Air Confession to 2017 Parents’ Murders
U.S. Defense Chief Orders Sudden Summit of Hundreds of Generals and Admirals
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
Trump Claims FBI Planted 274 Agents at Capitol Riot, Citing Unverified Reports
India: Internet Suspended in Bareilly Amid Communal Clashes Between Muslims and Hindus
Supreme Court Extends Freeze on Nearly $5 Billion in U.S. Foreign Aid at Trump’s Request
Archaeologists Recover Statues and Temples from 2,000-Year-Old Sunken City off Alexandria
China Deploys 2,000 Workers to Spain to Build Major EV Battery Factory, Raising European Dependence
Speed Takes Over: How Drive-Through Coffee Chains Are Rewriting U.S. Coffee Culture
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Ringo Starr Champions Enduring Beatles Legacy While Debuting Las Vegas Art Show
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Colombian President Petro Vows to Mobilize Volunteers for Gaza and Joins List of Fighters
FBI Removes Agents Who Kneeled at 2020 Protest, Citing Breach of Professional Conduct
Trump Alleges ‘Triple Sabotage’ at United Nations After Escalator and Teleprompter Failures
Shock in France: 5 Years in Prison for Former President Nicolas Sarkozy
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
BNP Paribas Abandons Ban on 'Controversial Weapons' Financing Amid Europe’s Defence Push
Typhoon Ragasa Leaves Trail of Destruction Across East Asia Before Making Landfall in China
The Personality Rights Challenge in India’s AI Era
Big Banks Rebuild in Hong Kong as Deal Volume Surges
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Arnault Denounces Proposed Wealth Tax as Threat to French Economy
Study Finds No Safe Level of Alcohol for Dementia Risk
Denmark Investigates Drone Incursion, Does Not Rule Out Russian Involvement
Lilly CEO Warns UK Is ‘Worst Country in Europe’ for Drug Prices, Pulls Back Investment
Nigel Farage Emerges as Central Force in British Politics with Reform UK Surge
×