Lives are on hold due to rising living costs

Four in five people have said they’re suffering with their mental health due to the cost-of-living crisis, according to new research by PayPlan, one of the UK’s largest free debt advice providers.

Results from PayPlan’s recent impact survey highlighted that 79% of respondents also felt increasingly isolated because of the cost-of-living crisis.

At the end of last year, the free debt advice provider – who is currently experiencing record levels of demand – reached out to those who’d approached its services for help in 2022 to find out more about what people are experiencing, how they’re coping day-to-day and what effect the crisis is having not just on their finances, but on their health and lifestyle choices too.

The squeezed middle-class

One in ten customers who’ve approached PayPlan for help are from higher income households that earn over £60,000 per year. This is before we’ve seen the full impact on this population of mortgage interest rate rises.

The biggest financial concerns

People approaching PayPlan are also more indebted than in previous years (with a typical customer now having ten lines of credit plus priority arrears, which include rent, council tax, mortgage and energy). Debt repayments continue to burden many (69%), closely followed by energy bills (63%) and rent and mortgage payments (41%). In general, people are extremely worried about all their payments – and have indicated what support they need more of, including better forbearance options and increased support with budgeting.

Life on hold for many

The survey also found that people are delaying major life events, such as retiring and putting off moving house following a relationship breakdown. Worryingly, maintaining good health has also been put on hold in some cases.

One respondent said: “I’m putting off getting my medication to treat my depression, spinal problems and having the surgery I need, which is prohibiting my ability to work.”

Nearly half (43%) of respondents revealed they had cancelled medical appointments due to not being able to afford to travel there or pay for necessary prescriptions.

It’s not just the financial impact it’s having

Social isolation has come through as a common theme from the survey as 41% of respondents said the crisis has impacted their relationships while 79% reported that they’d become increasingly isolated by avoiding socialising.

One respondent shared: “I just feel so alone and I’m very close to ending my life. I can’t see any way out of this mess.”

And another respondent added: “I don’t have a social life. I often don’t speak to a person for six weeks or so.”

The positive impact of free debt advice

Rachel Duffey, CEO of PayPlan, said: “It’s evident from our survey that people are struggling to keep afloat and the effects of higher prices are seeping into many aspects of day-to-day life.

“It’s no surprise 2022 was our busiest year on record, surpassing the levels we saw during the pandemic.

“What’s a huge positive is people are reaching out for help sooner. As the crisis doesn’t seem to be slowing down anytime soon, we really want to highlight the importance of banks, lenders, debt advice organisations and utilities providers working in a joined-up way to really ensure people are getting the support they need, when they need it.

“The effects this [the crisis] is having on mental health is really worrying and ensuring people are able to receive help in an efficient and effective way, as we continue into 2023 and its new challenges, is crucial.”