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Personal finances lag behind economic recovery 15 January 2014

43% of British adults disagree with George Osborne’s claim that the UK economy has moved to ‘rescue to recovery,’ according to research from insolvency trade body R3.

Comparably, of the 2,006 people surveyed, 37% of British adults are in agreement with the Chancellor’s statement.

In spite of the improving economy, the survey showed 44% of the public admitted that they struggle to payday, increasing from 38% in February.

Philip Sykes, deputy vice-president of R3, said: “Optimism about the wider economy still isn’t entirely filtering through to how British adults think about their own bank balances.

“The rising cost of living, credit card debts, and rent costs are all preying on the minds of British consumers, many of whom are finding that their financial breathing room is becoming smaller and smaller.”

The rising cost of living is the primary source of blame by 71% of British adults who struggle to make it to payday, rising from 67% in June.

Another 26% blame credit card payments while 21% point the finger at rent payments.

Those aged 18-24 suffer most with rent payments, with 28% of those in this age group blaming rent payments for their financial difficulties.

Sykes said: “A few quarters of economic growth won’t make up for the impact the two-decade long consumer credit bubble has had on Britain’s household finances. Savings are low and there is still a worryingly high level of household debt out there.

“If wages can’t keep up with the rising cost of living, more and more British adults will feel like they’re being ‘left behind’ by growth.”

The latest research found that 27% of British adults had no savings to fall back on, and the age group least likely to have any savings are those 35-44, as 38% in this group said they have no savings.

 

 

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