FCA finds nearly half of UK adults are in a better financial position after seeking financial help

In a positive development over the cost of living crisis, the Financial Conduct Authority (FCA) has revealed that while many people are still struggling with their personal finances, the figures have improved over the last year.

Their research found that overall 7.4 million people were struggling to pay bills and credit repayments in January 2024, which is down from 10.9 million in January 2023. It’s a very positive figure, but it’s important to note that this is still higher than the 5.8 million recorded in February 2020, before the cost of living crisis began.

The FCA’s new cost of living survey was done by 3,450 UK adults who had completed the FCA’s main Financial Lives survey in May 2022. 

Other key findings:

• 5.5 million people said they had fallen behind or missed paying one or more domestic bills or credit commitments in the previous 6 months from January 2024, which is down from 6.6 million people in 2023.
• From January 2023 to January 2024, 2.7 million adults asked for help help from a lender, a debt adviser or other financial support charity because they found themselves in financial difficulty, and 47% of these people said they were in a better position after seeking help.
• 2 in 5 adults who had fallen behind on their bills said they had avoided talking to their lender about their finances.

The research also found which groups of people were more likely to be living in financial difficulty. These were renters, single adults with children, adults from a minority ethnic background and people living in the north-east of England.

Throughout the cost of living crisis, the FCA has reminded financial firms they must support their customers and work with them to manage payment difficulties. Getting nearly £60 million in compensation for 270,000 customers.

Sheldon Mills, Executive Director of Consumers and Competition said: “Our research shows many people are still struggling with their bills, though it is encouraging to see some benefitting from the help that’s available.”

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