Financial wellbeing in October 2024

Summary 

• The proportion of households having to make adjustments to cover essential spending has decreased to less than half (47%) in the month to October 11th.
• The fall in the financial adjustment rate is seen across all demographics. However, the largest decreases were seen with consumers with an income above £41,000.
• The missed payment rate reduced to 5.7%, returning to July 2024 levels. Reductions in missed payments were particularly seen by working age parents and mortgage owners.
• Consumers’ confidence in their future household situation has increased to -8, whilst confidence in the future UK economy and current household situation has remained similar to last month.

You can view more data and articles from our monthly tracker survey on our dedicated Consumer Insight Tracker page.

Fewer households are having to make adjustments to cover essential spending

In the last month, the proportion of households who had to make at least one adjustment to cover essential spending reduced by four percentage points from 51% to 47%. Adjustments include cutting back on essentials, dipping into savings, selling possessions or borrowing.  Much like previous months, the adjustments that consumers are most likely to do are cutting back on essentials (24%) and dipping into savings (23%).

Less than half (47%) of households made at least one adjustment to cover essential spending

The financial adjustment rate has declined across all demographic groups

The financial adjustment rate decreased across all demographic groups, showing that this element of financial difficulty had improved across the board. The decline was most prominently seen amongst consumers earning over £41,000. In September, half (49%) of this group made adjustments for essential spending, dropping to two-fifths (41%) this month, an eight percentage point decrease. In contrast, those earning £21,001 to £41,000 saw a two percentage point decrease to 48%, whilst those earning up to £21,000 experienced a five percentage point decrease to 56%. 

Consumers across different income groups, tenure types and family types have experienced a decrease in their financial adjustment rate

The missed payment rate continues to fall

The proportion of households missing a payment reduced by 1.1 percentage points to 5.7%. This represents the missed payment rate falling for the second month in a row, returning to July 2024 levels. This month, there was a decrease in the proportion of consumers missing a payment across all types of payments, except for rent payment.

Looking closer at the types of missed payments: 

• A mortgage payment was 1.1% (a decrease of 1.2 percentage points). 
• A household bill was 3.6% (a decrease of 1.1 percentage points).
• A loan and credit card payment was 2.7% (a decrease of 0.3 percentage points). 
• A rent payment was 4.3% (an increase of 0.9 percentage points).

5.7% of households said they had missed a payment in the month to October 11th

Decreases in missed payments are particularly seen by working age parents and mortgage owners

Some of the largest decreases in missed payments came from working age parents. This group’s missed payment rate decreased by 4.5 percentage points from 14.7% to 10.2%, returning to July 2024 levels, following two months of higher reported levels of financial difficulty. In contrast, pensioners and working age non-parents reported little or no change, with pensioners’ missed payment rate decreasing by 0.2 percentage points to 0.9% and working age non-parents’ missed payment rate remaining consistent at 6.3%.

One in 10 working age parents’ missed a payment in the month to October 11th

Aside from family type, when looking at different housing types, the decrease in missed payments was most prominently felt by mortgage owners. This month, the missed payment rate among mortgage holders decreased by 1.9 percentage points, dropping to 4.4%. This is on par with the low levels of missed payments seen in February (4.5%) and this time last year (4.3%). Conversely, renters’ missed payment rate reduced by 0.5 percentage points to 12.3%, and consumers that own outright missed payment rate reduced by 0.5 percentage points to 1.6%. 

Mortgage owners missed payment rate reduced to 4.4%

Consumers are feeling more confident in their future household finances

After a two-month decline, consumer confidence in their future household finances rose by seven percentage points to -8 in the month up to October 11th. This reflects 22% of consumers believing their financial situation will get better and 30% believing it will get worse. 

Despite this, there has been little change in consumers’ confidence in the future UK economy and their current household finances. Confidence in the future UK economy rose by 1 percentage point to -33, and confidence in current household finances decreased by one percentage point to 21.

Consumer confidence in their future household finances increases to -8

Summary

This month’s tracker survey shows a fall in financial difficulty for consumers, with the proportion of households missing a payment and making at least one adjustment to cover essential spending falling, and with consumers feeling more confident about their future household finances. Despite this  there has been little change in consumers’ confidence in their current household finances and the future UK economy.

Methodology

The fieldwork was conducted by Yonder on behalf of Which between 11th and 13th of October 2024. A sample of 2,086 UK adults were surveyed online and weighted to be nationally representative.