The average household is £1,435 a month short of being financially secure, according to research from uSwitch.com.
While the average monthly household income stands at £2,504, consumers say they need to bring in £3,939 to feel financially secure.
61% told the price comparison site that they don’t feel secure at all.
35% define financial security as having enough money to cover basic day-to-day living costs without having to rely on credit. But of these, just 40% are in this position. The second most popular definition is to have at least six months’ salary in the bank (16%), but again, of these just 35% have this.
Although recent figures show that wage increases in the private sector rose faster than UK inflation last quarter for the first time in three years, only 30% said they expect a pay rise this year and 65% have suffered a pay freeze in recent years – with 15% seeing their pay frozen for at least three years.
“The dream of financial security seems a long way off becoming a reality for many,” said Michael Ossei, personal finance spokesperson at uSwitch.com.
“Years of pay freezes and the rising cost of living have hit consumers hard and led to a financial nightmare where they are now almost £1,500 a month short of the household income they need to be secure. And it’s unlikely that things will get better quickly – with few people expecting pay rises, the majority of homes are unlikely to see any rise in their monthly income, let alone the sort of increase they feel they need.”
