Brits counting the financial cost of Covid-19

Research from Indesser, a joint debt management venture between the Cabinet Office and TDX Group, reveals that 43% of Brits admit they worry about their finances every day.

A clear pattern from the findings is the disproportionate impact of Covid-19 on the personal finances of younger people, the study shows. Nearly one-third of respondents overall (31%) said they may be unable to pay bills or make debt repayments. This figure drops dramatically for those aged 65+ (3%), and significantly rises for the 18-24 (38%), 25-34 (39%), and 35-44 (41%) year old categories.

The research shows that 12% of respondents have fallen into arrears on their mobile phone bill, 9% on their water bill, and 8% behind on mortgage or rent. The situation is expected to become more challenging in autumn, the study shows.

While 40% of people overall stated they had three months of expenses saved up, this figure drops to 32% for both the 18-24 and 25-34-year-olds, compared to 69% for those 65 and over.

Richard Haymes, director of consumer affairs at Indesser, said: “Our survey evidences just how concerning and complex the financial impact of Covid-19 has been for millions of people across the UK. Age is a major determinant, especially when it comes to the likelihood of falling into arrears on debt, both now and in the future. Over nine million people have been placed on furlough and 695,000 jobs were lost between March and August, with 16-24-year-olds hardest hit. Economic uncertainty and disruption will continue for some time, with detrimental consequences for many.

“People falling behind on bills and repayments will need support, empathy and compassion from their creditors. It’s more important than ever that individual circumstances are taken into account and data utilised when assessing people’s financial situations. Developing tailored repayment and debt recovery plans will result in better outcomes and more responsive customers.”