Financial Lives January 2023: Consumer experience of the rising cost of living – the burden of bills and ways to get support

Financial Lives 2022 survey – Fieldwork
May 2022
Financial Lives cost of living (Jan 2023) recontact survey – Fieldwork
January 2023
Financial Lives cost of living (Jan 2023) recontact survey – Report publication
May 2023
Financial Lives 2022 survey – Main report publication
Summer 2023
Summer 2023

We are providing selected statistics in this research note from our Financial Lives cost of living (Jan 2023) recontact survey, to give an insight into the financial situation UK adults experienced over the 6 months to January 2023.

Later in the year we will be publishing our full Financial Lives 2022 survey report. It will include full results and more detailed analysis from the January 2023 recontact survey. See the annex below for more information on Financial Lives, including this recontact survey.

The help people need to deal with the rising cost of living goes beyond financial services. But the industry has a vital role to play in supporting people during these challenging times. We have set clear standards and expectations for how consumer credit, mortgage and insurance firms should help customers in financial difficulty, and we are taking assertive regulatory action where firms fail to meet them. These survey findings highlight the continued importance of ensuring consumers get appropriate support when facing financial difficulty and ideally seek such support at an early stage.

We encourage anyone struggling to keep up with payments to contact their lender or insurance provider for support. Consumers can also visit MoneyHelper for useful tips on living on a squeezed income and to find free, expert debt advice.

1. Summary findings

  • The number of adults who missed payments on any domestic bills or meeting any of their credit commitments in 3 or more of the previous 6 months went up by 1.4 million: from 4.2 million (8%) in May 2022 to 5.6 million (11%) in January 2023.
  • The number of people who felt that making these kinds of payments was a heavy burden jumped from 7.8 million (15%) to 10.9 million (21%).
  • Our survey also showed that 29% of UK adults with a mortgage and 34% of renters experienced payment increases in the 6 months to January 2023.
  • Of UK adults who were insurance or protection policyholders in May 2022, 8% cancelled one or more of their policies, and 7% reduced the level of cover on one or more their policies – in the 6 months to January 2023, specifically to save money due to the rising cost of living. As some policyholders did both (cancelled and reduced cover), this means that 13% of May 2022 policyholders (or 6.2m people) cancelled and/or reduced cover.
  • The toll on mental wellbeing was considerable, we found that just over 1 in 2 UK adults, or 28.4 million people, were more anxious or stressed due to the rising cost of living.
  • Some survey participants told us in their own words how the rising cost of living was affecting them. We have included some of these examples to demonstrate the impact on people’s lives.
  • Some respondents shared positive stories of their dealings with firms that reflect the guidance we give, for example that consumers should contact their credit or mortgage lender if they are struggling with payments. We have included some of these positive stories to encourage consumers to seek support early, and to illustrate to firms the real-life, beneficial impact of proactive support and appropriate forbearance.

2. Changes in people’s financial situation

The survey investigated how people were managing to pay bills.

Asked about the burden of keeping up with domestic bills and credit commitments, 1 in 5 (21%) described it as a heavy burden (up from 15% in May 2022) and just over half (51%) as somewhat of a burden (up from 45% in May 2022). As Figure 1 shows, in total 72% of UK adults felt that keeping up with these bills was a burden.

The figure also shows that over three-quarters (77%) of UK adults in the 6 months to January 2023 felt that the burden of keeping up with their domestic bills and credit commitments had increased: 27% saying a lot more of a burden, and 50% saying a little more of a burden.

"I took out two credit cards to pay for my MOT, car repairs, and a kettle when broken. I also now pay for home insurance on credit card. And I purchase food on credit sometimes." (Female, 45-54)


"We rely on oil to heat our home, as we are not connected to mains gas where we live. We have a coal fire – the cost of oil has more than doubled since last year, with the price of coal up threefold. We rarely put the heating on, as the costs for oil are just crippling.  All my savings have just been spent on filling my oil tank – over £1000." (Female, 35-44)


The group we describe as being in financial difficulty, on the objective measure of having missed paying domestic bills or meeting credit commitments in 3 or more of the previous 6 months, went up from 8% in May 2022 to 11% in January 2023, which is an increase of 1.4 million people.


Chart tips: hover over the data series to view the data values and filter the data categories by clicking on the legend.


Data table

Base: All UK adults (5,286) excluding ‘don’t know’ responses (2%)/ All UK adults (5,286) excluding ‘don’t know’ responses (3%)/ All UK adults (5,286)/ All UK adults who had a residential mortgage on the property in which they live at the time of the May 2022 survey (1,513)/ All UK adults who were renting at the time of the May 2022 survey (983) excluding those who told us in January 2023 that they were no longer renting (5%)/ All UK adults who were insurance or protection policyholders in May 2022 (5,006) Question: K1 (Rebased)/ K1a (Rebased)/ K2/ Q15 (Rebased)/ Q17 (Rebased)/ Q3 (Rebased)


Another survey insight, as Figure 1 also shows, is that 3 in 10 (29%) of the adults who had a mortgage in May 2022 had seen increased payments in the 6 months to January 2023. This equates to 8% of all adults, as not all adults had a mortgage. For renters, a third (34%) had seen their rent go up in the 6 months to January 2023. This equates to 10% of UK adults paying more rent. In total, therefore, 18% of UK adults had had mortgage or rent payment increases in the 6 months to January 2023.


"The thing that hurts the most and has had the biggest impact on my finances is the interest rate rises on the mortgage. That's made things particularly tough." (Male, 45-54)



"Much higher rent in particular means I have less money after outgoings to put towards savings, investments or a mortgage deposit." (Female, 45-54)


We also see that 1 in 8 adults (13% or 6.2m) who were insurance or protection policyholders in May 2022 cancelled at least one of their policies (8% or 3.6m) and/or reduced the level of cover on at least one of their policies (7% or 3.1m) in the 6 months to January 2023, specifically to save money due to the rising cost of living.  

The policies cancelled by the highest proportions of May 2022 policyholders were:

  • extended warranty – cancelled by 5.0% of extended warranty policyholders
  • separate home contents insurance – cancelled by 3.8% of separate home contents policyholders
  • pet insurance – cancelled by 3.8% of pet insurance policyholders
  • gadget insurance – cancelled by 3.1% of gadget insurance policyholders
  • mobile phone insurance – cancelled by 2.5% of mobile phone policyholders

No more than 1.5% of May 2022 policyholders cancelled any other type of policy.  

"I have had to cancel insurances and social outings to make ends meet, to prevent going into debt, along with eating a lot less to make meals go further." (Male, 35-44)


"I had to take my son off the motor insurance… This means that he doesn't have the chance to drive our car, when he is here with us during the holidays." (Female, 45-54)

3. The impact on mental wellbeing

As a result of the rising cost of living, over half (54%) of UK adults felt more anxious or stressed. Figure 2 highlights some other worrying statistics related to the increasing cost of living. This includes just over 1 in 10 (11%) UK adults having put off dealing with financial matters (for example, by ignoring warning letters or not opening correspondence) and/or having avoided speaking to their lenders about their finances or debts.


Data table

Base: All UK adults (5,286) excluding ‘prefer not to say’ responses (2%) Question: Q14 (Rebased)


"I’ve seen less of my family, as I have to drive long distances to see them, and I’ve stopped playing sport and participating in clubs…because I cannot afford the subs." (Female, 45-54)


"I suffer from health problems and my body temperature on most days is close to hypothermic at 35 degrees. I can't afford to turn the heating up. This has made me feel more lonely than ever before, and I can't afford to go visiting family." (Female, 35-44)


"We are struggling to keep the heating on and now opt for days without it. I have been secretly skipping meals, so my working partner can eat, as he needs the energy more than me. We have been arguing a lot because the financial stress is exhausting, and my partner’s mental health has deteriorated completely from healthy to crisis. I am disabled due to serious mental health problems, and they have gotten much worse. We have both lost significant weight due to having to buy less food and it's destroying our physical and mental wellbeing." (Male, 18-24)


"I have lent money to family to support their situation which has left me feeling more anxious and stressed about money – it has left me with significantly less savings if I was faced with an emergency." (Female, 25-34)


"I spent three years getting myself financially stable after a relationship break up. I was looking forward to my future… I feel the future is scary and unpredictable, because I don't know how I'll afford to live …I'm a single person with a job and no dependents but I feel financially insecure." (Female, 35-44)


We have reminded firms that if a customer is in vulnerable circumstances, they should provide them with an appropriate level of care and support.

4. Stories about good consumer support outcomes

We heard positive stories from some consumers about their experience dealing with financial services providers and how they are managing debts and costs better as a result. These stories are illustrative only, and we highlight them to encourage other consumers to seek support and to demonstrate to firms the benefits of proactive support and appropriate forbearance.

Some consumers told us they were pleased with how they were treated when they contacted their lender. Some arranged new payment plans to enable them to pay a reduced amount for a longer period, while some were referred to not-for-profit debt advisers.

"I contacted my loan company to ask for a smaller payment amount monthly, and it was a really easy and pleasant experience. My adviser was exceptionally approachable and helpful." (Female, 35-44)


"I was worrying about my increasing credit card debt and was thinking about remortgaging, but I spoke to an adviser who talked me through options and I realised I could pay my debts…without increasing my mortgage." (Female, 35-44)


"With my credit card I've been quite honest and upfront with them, you know, rang them up to tell them my situation… I know it needs paying, but at the minute I can't do that. It gives you some breathing space. I did get some advice as well, and I've got a budget plan off a firm called Step Change." (Male, 55-64)


"My husband had to speak to financial companies to set up payment plans for a couple of credit cards… And [high-street bank] he found were from the very beginning really, really helpful, very understanding. And were the first to sort of just say, right, that's fine. We'll put payments on hold; we'll make arrangements for a payment plan, when it's possible for you." (Male, 45-54)


Some consumers noticed that providers were proactively reducing costs or helping consumers to do so. Some consumers were familiar with the concept of ‘cost-of-living support’, such as an interest-free overdraft.

"I was delighted to discover my home insurance was reduced this year from £125 to £97 because of the cost-of-living crisis." (Female, 45-54)


"My mortgage company wrote to me lowering my mortgage by nearly £20 a month, and my credit card company wrote to me to switch debt to save interest. I find people I deal with very helpful." (Female, 45-54)


"I'm overdrawn twice this month already. I've negotiated with my bank that they will give me an interest-free overdraft up to £500… They did say in the offer to seriously consider, you know, because otherwise it's easy to go into debt… They called it the cost-of-living support. Oh, that was their title on the letter, I think. So, it was obviously a reaction to people's problems and finding a way to help them, which I found very, very good for a bank to be doing it." (Male, 75-84)


We heard stories from some consumers of significant savings made when they contacted their provider to cancel or reduce the level of cover on policies. We also heard of providers waiving the cancellation charge.

"I did cancel insurances. They were very helpful. They did try to give me a reduced rate. But what the problem was, no matter how I worked it out, I still was like thinking the point where it'd all go out and there was no food, so I had to quit it. The lady was lovely, and she waived the charge. She said we've had loads of customers ringing and doing the same. I understand that you're all stuck." (Female, 45-54)


"The home insurance, at one stage I thought, I'm going to knock that on the head, I can't afford that… There was an insurance brokers in town and I said, look, this is the situation. They managed to get me…around £14 a month. I mean that doesn't sound a lot, but when you've only got a budget of £340 a month, it's all relative." (Male, 55-64)

5. Annex: More information about Financial Lives

Financial Lives, our flagship survey of adults aged 18 and over across the UK, provides a wealth of information about consumers – including their experiences with financial services providers, their financial situation and resilience and the financial products they hold.

Our latest main survey – Financial Lives 2022 – was completed in May 2022 with 19,145 responses. In October 2022 we published selected results from this main survey on vulnerability and financial resilience to give an insight into the financial positions of UK consumers in May last year.

From 6 December 2022 to 16 January 2023, we ran a short survey among respondents to our main Financial Lives 2022 survey. We gained 5,286 responses. We weighted these responses to provide nationally representative results. As the majority (68%) of these responses were completed in January 2023, we refer to this survey as our ‘Financial Lives cost of living (Jan 2023) recontact survey.’

This recontact survey was designed to understand the significant financial impact of the rising cost of living on adults across the UK over the 6 months to January 2023. It provides insights for the FCA and for lenders, insurance companies and other interested parties about the numbers of consumers struggling to pay their bills and/or seeing their debts increase. The survey explored the ways in which consumers dealt with the rising cost of living.

We also asked some open questions around what the rising cost of living means to consumers and about their recent experiences in dealing with financial services firms. This is to gather illustrative feedback on their experiences in their own words.

We will publish the full Financial Lives 2022 survey report later this year. It will include full results and more detailed analysis from this Financial Lives cost of living (Jan 2023) recontact survey.