London Daily

Focus on the big picture.
Monday, Oct 26, 2026

Families face debt squeeze as prices keep rising

Families face debt squeeze as prices keep rising

A resurgence in cases of people unable to cover their debt repayments is expected, a charity has warned, as the cost of living hits family budgets.

Debt advisers are urging people who are struggling with existing debts to come to fresh arrangements on how much to repay each month.

Doing so made the basics affordable again, one dad told the BBC.

Prices are rising at the fastest rate for 30 years, creating fresh strain on people's finances.


'Dramatic increases'


Many thousands of people are on debt management plans (DMPs), often when they owe money to a host of companies which they cannot afford to repay under the original agreement.

Creditors are offered a lower, but regular, payment which is made each month. This is designed to fend off the likelihood of a default and, in return, lenders tend to freeze interest or any further charges.


Prices, as measured by inflation, are currently rising at a rapid rate - the fastest since 1992. This means some people who were previously keeping to their DMP repayments are now finding it a lot more difficult. Rising domestic gas and electricity bills, and accelerating price rises, are likely to add to the strain.

Sue Anderson, from debt charity StepChange, which negotiates DMPs, said: "Through the Covid pandemic we saw an increase in the number of clients who were temporarily unable to continue to meet their planned payments on managed debt solutions, and now it looks as if we are going to see a resurgence of this as a result of dramatic increases in the cost of living."

Among the charity's clients, nearly twice as many said in March that the rising cost of living was a key reason for getting into debt compared with six months earlier.

It was the third most likely reason given, behind a lack of control over finances and unemployment or redundancy.

Andy is on a repayment plan and is urging others to seek help


When Andy Barwell spoke to BBC News in December, the father-of-two said urged others to learn from his example that you cannot "live a champagne life on a lemonade budget".

Debts had taken him to the brink, but he had got his life back on track. Now, six months later, he said even he needed to act as energy bills and rent had become more expensive.

"Everything just seems to be a bit tighter now. For now, all treats have had to stop, not that there was many before.

"I have contacted [Stepchange] and amended my repayments to something more affordable. Granted, this means my debt will take longer to pay off but at least I can still afford the basics and also know that my debts are being paid too, and that no interest or added costs are piling back up on top."


'Get help early'


Sara Williams, who writes the Debt Camel blog - which has covered this issue, said that signs of difficulty needed to be addressed early.

She said the prospect of further price rises meant that anyone finding it hard now should ask how they would get through the next three months or more.

Among the tell-tale signs, she said, was when people reached for a credit card as the only way to pay for fuel in the car.

"If you are struggling now, then ask for a reduction, but be realistic," she said.

She added that creditors would not want requests to be commonplace, and borrowers could always increase repayments when the situation improved.

Newsletter

Related Articles

0:00
0:00
Close
UK Consumer Confidence Tumbles Amid Rising Energy Costs and Global Commodity Price Pressures
North Sea Transition Authority Approves Production from Jackdaw Gas Field to Bolster Domestic Energy Security
Storm Boelo Leaves Tens of Thousands of Households Without Power Across Scotland and Northern Ireland
UK Government Launches National Be Ready Campaign Urging Households to Prepare Three Days of Emergency Supplies
Department for Environment Food and Rural Affairs Implements Stricter Water Quality Regulations for British Rivers
Welsh Government Launches Major Renewable Energy Initiative to Expand Offshore Wind Capacity Along the Coast
Northern Ireland Executive Reaches Final Agreement on Comprehensive Regional Infrastructure Modernization Plan
Office for National Statistics Reports Moderate Increase in British Retail Sales Driven by Autumn Discounts
Scottish First Minister Announces Emergency Housing Strategy to Tackle Severe Homelessness Across Urban Centers
Automotive Industry Leaders in the United Kingdom Urge Government Support for Electric Vehicle Manufacturing Transition
United Kingdom and European Union Initiate High-Level Negotiations on Post-Brexit Defense and Security Pact
National Health Service England Introduces Sweeping Digital Reforms to Reduce Hospital Waiting Lists Nationwide
Chancellor of the Exchequer Outlines Emergency Fiscal Measures to Address Local Government Funding Crises Across England
Bank of England Governor Warns of Persistent Inflation Pressures Impacting Interest Rate Decisions in the United Kingdom
UK Conservative Party Suspends Former Electoral Candidate Following Undercover Investigation
Actors and Writers Condemn British Anti Terror Legislation Targeting Activist Groups and Free Speech
Central Bank and Treasury Monitor Inflation Risks as International Monetary Fund Upgrades United Kingdom Growth Forecast
Storm Boelo Batters British Isles With Eighty Mile Per Hour Winds Causing Widespread Power Outages
British Intelligence Services and Technology Firms Partner to Counter Artificial Intelligence Enabled Cybersecurity Threats
UK Consumer Confidence Falls at Fastest Rate Since Brexit Vote as Cost of Living Intensifies
Chancellor John Healey Prepares Landmark Autumn Budget Focused on Devolution and Fiscal Rules
Northern Ireland Executive Ministers Reach Consensus on Shared Economic Development Priorities to Stimulate Regional Growth in Belfast
Department for Business and Trade Finalizes Conditional Support Package for Advanced Semiconductor Fabrication Facilities in Newport
Welsh Government Unveils Regional Industrial Development Strategy to Attract Green Energy Investment to South Wales Manufacturing Hubs
Foreign Secretary David Lammy Concludes Diplomatic Mission to European Capital Cities to Strengthen Post-Brexit Defense Cooperation
Department for Environment, Food and Rural Affairs Implements Stricter Regulatory Compliance Standards for Water Utilities Across England
Office for National Statistics Reports Moderate Wage Growth Stabilization and Resilient Employment Figures Across the United Kingdom
Scottish Government and Trade Union Representatives Reach Tentative Pay Agreement for Public Sector Transport Workers in Edinburgh
National Health Service England Announces Emergency Capital Funding Allocation to Reduce Winter Emergency Department Bottlenecks
Bank of England Monetary Policy Committee Signals Cautious Approach to Interest Rate Reductions Amid Persistent Inflation Pressures
British Prime Minister Keir Starmer and Treasury Officials Finalize Urgent Fiscal Adjustments Ahead of Upcoming National Budget
Tour de France Organizers Confirm Historic Grand Depart Featuring Edinburgh and Yorkshire Stages
National Cyber Security Centre Issues Urgent Alerts Following Global Security Vulnerability in Core Programming Software
Independent Energy Analysts Warn Great Britain Faces Highest Winter Power Tariffs in Europe
Major British Defense Contractors Commit to Delivering Forty Thousand New Apprenticeships and Training Placements
New Bradford Railway Station Infrastructure Project Approved to Transform Regional Transit Connectivity Across Northern England
Welsh Infrastructure Stakeholders Press Government for Accelerated Local Sourcing in Military and Uniform Manufacturing
Scottish Council Governance Crisis Triggers High-Court Legal Challenge Over Leadership Ouster Bid
High Street Bakery Chain Greggs Announces Major Factory Closures and Seven Hundred Job Cuts
Automotive Manufacturer Jaguar Land Rover Advances Advanced Defense Technology Partnership with European Allies
Treasury and Bank of England Officials Signal Persistent Concern Over Inflation-Driven Interest Rate Path
International Monetary Fund Upgrades United Kingdom Growth Forecast While Issuing Inflation Warnings
National Health Service Leaders Warn of Severe Capacity Pressures as Early Winter Respiratory Infections Surge
Government Issues Emergency Resilience Guidance Advising All British Citizens to Stockpile Essential Supplies
United Kingdom Private Sector Growth Beats Expectations in October Driven by Resilient Services and Manufacturing
Barclays to Cut Five Thousand Jobs in Major Artificial Intelligence Adoption and Cost-Cutting Overhaul
Piper Tomahawk Aircraft Crash Near Drymen in Stirling Claims Two Lives as Investigators Deploy
North Sea Transition Authority Approves Jackdaw Gas Field Production After Ministerial Authorization
Government Injects One Hundred and Forty Million Pounds to Expand Urgent Care Ahead of Winter Crisis
Department of Health Warns Further Pay Rises Will Derail National Health Service Waiting List Targets
×