In too deep? - The impact of the cost of living crisis on household debt - Felicia Odamtten & Simon Pittaway

In too deep? The impact of the cost of living crisis on household debt Felicia Odamtten & Simon Pittaway February 2024 resolutionfoundation.org @resfoundation In too deep? | The impact of the cost of living crisis on household debt 2 Acknowledgements The authors are grateful to The Health Foundation for supporting this work. [...] The use of the ONS statistical data in this work does not imply the endorsement of the ONS in relation to the interpretation or analysis of the statistical data. [...] Resolution Foundation In too deep? | The impact of the cost of living crisis on household debt 6 The combination of the rising cost of living and higher interest rates has raised concerns about Britons’ use of debt The rising cost of mortgage debt has been in the news in recent months.1 But less attention has been paid to other types of financial debt, such as credit cards, overdrafts and personal. [...] As Figure 2 shows, the proportion of households using consumer debt has been broadly flat since the start of the pandemic: both the share of households using credit cards and the share using other types of consumer debt (car 10 For a detailed look at the NMG Survey and a comparison to other surveys of household finances, see: G Anderson et al., The Bank of England / NMG Survey of Household Finance. [...] We therefore construct an estimate for the 2023 share of households with credit card debt that is comparable to earlier years of the NMG Survey calculating the change in the share of households with a credit card in the November 2022 and October 2023 waves of the YouGov Cost of Living Crisis Survey, and applying this change to the 2022 share in the NMG Survey.