The current economic environment of high inflation and the continued cost of living crisis has presented some serious financial challenges for many households, according to a report from Schroders Personal Wealth.
The Schroders Personal Wealth Money and Mind Report found that two-thirds (64 per cent) of UK adults are currently concerned or very concerned about their finances.
Of those concerned, a quarter (25 per cent) of UK consumers were worried they would not be able to afford household basics such as food.
The report, which surveyed 1,000 UK adults aged 35 and above, looked at how the nation is feeling about their finances, how money matters are impacting their wellbeing and what they are doing about it, if anything.
Almost three quarters (73 per cent) said that they are worried about the impact of the cost of living crisis on their finances, whilst nearly half (46 per cent) admitted they think about their finances more than they used to.
One in three (29 per cent) said they felt stressed and anxious about their finances, whilst 87 per cent said their mental wellbeing is impacted by their financial situation.
Ben Waterhouse, chief client officer at Schroders Personal Wealth, said: “With the continuing cost of living crisis, it is a disheartening reality that one of the biggest stresses adults in the UK face is related to their finances.
“Even if you have your basics covered, the ‘high inflation, high interest rate environment, which has prevailed for most of 2023 and is likely to be with us for some time yet, is squeezing household incomes.
“This squeeze lessens the ability to save each month, which means people may not be able to afford the financial futures they had previously hoped for.”
The research found that less than a quarter (23 per cent) are currently keeping more money as cash savings, while 22 per cent admit they are worried about their savings and investments but do not know what to do.
Despite these concerns only 5 per cent said they have spoken with their financial adviser.
Meanwhile, just under a half (49 per cent) of UK adults are likely to make a financial plan, while 20 per cent said they are unlikely to make one.
Only 9 per cent already have a financial plan in place.
For those who said they might put a plan in place, a third had not yet done so because they admitted they didn’t know where to start.
Over a quarter (26 per cent) had not done so because they thought it would cost too much.
Waterhouse said: “It’s concerning to see the impact the cost of living crisis is having on people’s wellbeing.
“Financial wellbeing doesn’t necessarily have to equate to being extremely wealthy. We believe it comes from being in control of your finances – knowing how much you need to realise your financial goals, and being confident you are on the right path to reach them.
“A great way to take control is by putting in place a well-structured financial plan.”
