Financial wellbeing in the November 2023 tracker

Summary

• There was a large increase in reported levels of financial difficulty in November 2023 as 9.8% of people said they had missed or defaulted on a loan, credit card, housing or household bill payment in the past month. This is the highest level recorded in the last three and a half years.
• Household finances remain under pressure for a large swathe of the population with 57% of households making at least one adjustment to cover essential spending in the last month.
• Consumers’ confidence in their current household financial situation and the outlook for the UK economy fell for the second straight month. Half of all consumers (53%) think the UK economy will worsen over the next 12 months and only 16% believe it will get better.

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

Financial difficulty rises dramatically in November

Many households have struggled to pay their bills over the last two years during the Cost of Living crisis. Rather than showing signs of easing as the inflation rate falls, even more households now appear to be facing hardship. The proportion of households that missed a payment rose dramatically in the month to November 10th, with almost one in ten (9.8%) reporting that they missed a housing, bill, credit card or loan payment in the month to November 10th. 

This rate of missed payments is the highest level we have ever recorded (since April 2020), surpassing the previous high of 9.1% in January 2022. 

9.8% of households said they had missed a payment in the month to November 10th

Looking closer at the types of payments missed, the proportion of households that missed;

• a household bill (e.g. water or energy bill) was 5.6%
• a loan or credit card payment was 5.3%
• a mortgage payment was 2.9% amongst mortgage holders
• a rent payment was 8.8% amongst renters

Less severe financial difficulties continue to be experienced by a much larger swathe of consumers. Almost 6 in 10 (57%) households reported having made at least one adjustment to cover essential spending such as utility bills, housing costs, groceries, school supplies and medicines in the last month. Adjustments include cutting back on essentials, dipping into savings, selling possessions or borrowing. 

Almost 6 in 10 households made at least one adjustment to cover essential spending in the last month

These figures show that a large number of households are struggling to pay their bills, possibly for the first time for many. These people may have previously managed by making adjustments to their essential spending, but the impact of the continuous rise in living costs may have caught up with them. On top of these distressing financial difficulty figures, many consumers are pessimistic about future financial situations.

The recovery in consumer confidence has faltered

Consumers’ confidence in their current household financial situation and the outlook for the UK economy fell for the second straight month, following earlier signs of recovery in August and September. Only about one in six (16%) consumers think the UK economy will get better over the next 12 months, whilst 53% believe it will get worse, giving a net confidence in the future economy of -37. This is a 10 point drop compared to two months ago.

Consumers’ views on their current household situation also fell slightly this month to +14, down from +21 two months ago. Here we’ve seen a fairly steady decline in confidence since the Cost of Living crisis began hitting consumers’ pockets. Despite this, more consumers feel positive about their current household finances (39%) than negative (24%).

Confidence in future household finances remained steady this month at -12. This was calculated from 21% of consumers thinking their household financial situation will get better over the next 12 months and 32% thinking it would get worse.

Consumer confidence fell again in the month to November 10th

Summary

As we approach the lead up to Christmas these figures paint a bleak picture for UK households. This months’ tracker survey was defined by a rise in financial difficulty, alongside a fall in consumer confidence. This shows that many consumers are continuing to struggle to make ends meet, pay their bills and many expect that things will only get worse. We will continue to track these concerning figures in the coming months to see if the uptake in financial difficulty and increased pessimism persist. 

Methodology

The fieldwork was conducted by Yonder on behalf of Which between 10th and 12th November 2023. A sample of 2,093 consumers was surveyed online and weighted to be nationally representative.