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Financial resilience worsened in July as people struggle to save, report finds

By PA News

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One in three people reported being unable to save for the year ahead (Dominic Lipinski/PA)

Increasing numbers of people have said they will struggle to save and cope with surprise bills and almost a third believe it will take more than a year for life to return to normal.

New figures from the Office for National Statistics (ONS) reveal that in July, three in 10 people said they believe life will not return to normal for at least a year – up from two in 10 in June.

The same report on personal and economic wellbeing during the pandemic also found “financial resilience worsened in July”.

It said parents and people renting properties particularly stressed their financial vulnerability.

Roughly half of people within these groups could not afford an unexpected but necessary expense by July 26.

Across all respondents, one in three people reported being unable to save for the year ahead, with this figure up to 41.6% for those aged between 30 and 59.

This also resulted in an increase in borrowing, with 13.3% of people reporting they had to borrow money or use credit more than usual in July.

Parents were particularly affected, with 22.2% saying they increased borrowing.

One in six people said they had seen a reduction in their household income in July – which was a marginal improvement from data for the end of May.

This came as people surveyed said they increasingly returned to work throughout June and early July.

People on incomes below £20,000 saw a significant increase in the number of people returning to work, however the ONS said this trend “stalled” in the last weeks of July.

It also revealed 73.4% of those employed with a vulnerable health condition did some work at the end of July, jumping from 47.5% in May.

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