Rise in those struggling to pay bills in last six months
Over a million more households are struggling to pay their bills each month since the UK fell back into recession, according to research out this week.
Legal & General’s latest MoneyMood Survey shows that the number of households which say they are ‘struggling’ financially and do not have enough money to cover their bills each month has risen by 1.2 million between September 2011 and April 2012.
The UK recorded negative GDP growth in both Q4 2011 and Q1 2012, putting the country officially into a double-dip recession.
The L&G analysis shows that in September 2011, 11% of respondents were classified as ‘struggling’, which has now climbed to 16%.
The proportion of those classed as ‘surviving’, whose income just covers their bills and debts, has remained fairly stable at 42% compared to 44% in September.
But the proportion of respondents classed as ‘stable’, with money left over at the end of the month, has fallen from 45% in September to 39% now, its lowest level since the coalition government came to power in May 2010.
Mark Gregory, executive director of savings at L&G, said the number of people spending more than their income on paying bills and debts is estimated to have risen from approximately 2.1 million households in September to 3.3 million households now.
He said: “For those families who are struggling our latest figures indicate the average monthly shortfall nationwide is just under £74 per month. This is an improvement compared to three months ago, when we first asked how much struggling households are short each month, and the average shortfall stood at £96 per month.
“However, the overall monthly shortfall across the nation has gone up in total by over £30.8m, driven by the higher number of households unable to make ends meet. We estimate the nation’s monthly shortfall now stands at £244m each month.”