Cost-of-living crisis could be creating ticking health timebomb

One-in-five (19%) households are putting off dental treatments due to worries about costs. A third (35%) were not able to afford a healthy balanced diet at least once in the past month. A similar proportion (33%) report that financial worries cause them to sleep poorly at night and 35% say their financial situation is making their mental health worse. Many also (27%) say their financial situation is making their physical health worse.

Researchers found the situation is particularly concerning for those categorised as in ‘serious financial difficulties’ (9.6 million people across the UK live in such households). One-in-five of those in serious financial difficulties had not eaten for a whole day at least three times during the last month. In this group, as a direct result of needing to cut back on spending to save money:

• 82% were not able to afford a healthy balanced diet at least once in the past month
• 46% are putting off dental treatments
• 19% are avoiding medical appointments
• 18% cannot afford medications or medical equipment.

The Financial Fairness Tracker, commissioned by abrdn Financial Fairness Trust and analysed by a team of experts at the University of Bristol, has been monitoring the personal finances of households since the start of the pandemic, using a sample of around 6,000 people.

Illustrating how hard those on the lowest incomes have been hit by the cost-of-living crisis, many indicators of wellbeing which affect physical and mental health are lower than at the start of the pandemic. Of those in serious financial difficulties, 61% of households reported not being able to keep their home warm and comfortable in the last six months. Similar numbers said they were cutting back social on social interaction with friends and family (64%) and participating less in hobbies and pastimes (61%).

Researchers looked at which households are cutting back, and what areas they are reducing spending. This leads them to describe cost-cutting as ‘the new normal’, with just a quarter (26%) of households not having taken measures to cut back, while the majority are taking steps to cut costs in one or more areas. Of all households over the last six months:

• 49% have cut back on eating out and takeaways
• 46% are shopping at cheaper supermarkets/bought cheaper food products
• 35% have not booked holidays or breaks away.

On a general level, financial well-being is lower than it was when the first survey took place at the start of the pandemic (April 2020). Since then, there has been an 11 percentage point decrease in households who are financially secure (from 37% to 26% of households).

Professor Sharon Collard, Chair in Personal Finance at the University of Bristol Personal Finance Research Centre, said: “The worsening levels of food insecurity caused by rising living costs cannot be ignored. The number of people who cannot afford to eat healthily, or even eat three meals a day, is worrying. Although government has taken welcome steps to support those who are worst off, these figures show that more needs to be done to help; relying on food banks is not a viable long-term solution.”

Mubin Haq, CEO of abrdn Financial Fairness Trust, said: “The cost-of-living crisis is having a serious impact on decisions millions are making about their health. It is shocking that people are routinely delaying dental treatment, not taking medication, and not eating due to their inability to afford these essentials. Short-term cost savings are likely to have long-lasting consequences to the nation’s health. This is a high price to pay and could have knock-on effects on the labour market with people being unable to work due to poor health.”

Further information

abrdn Financial Fairness Trust

abrdn Financial Fairness Trust funds research, policy work and campaigning activities to tackle financial problems and improve living standards for people on low-to-middle incomes in the UK. It is an independent charitable trust registered in Scotland.

abrdn Financial Fairness Trust was known as Standard Life Foundation until December 2021.

Financial Fairness Tracker

The tracker is carried out on a regular basis by YouGov. People in Northern Ireland, Wales, England and Scotland are asked about their income, payment of bills, borrowing, debt, savings and other financial changes, including their ability to pay for essentials such as food. Respondents are randomly recruited from YouGov’s online panel. The base for analysis is persons who are responsible for the household finances. Non-householders who are responsible only for own personal finances (most of whom were aged under 25 and lived at home with their parents) are not included in the analysis for this report.

The tracker identifies the demographic characteristics and socio-economic circumstances of who has been affected, as well as the strategies that are being used by people who have been adversely affected by the crisis to make ends meet.  It also identifies how many, and what types of people, are expecting their financial circumstances to deteriorate over the coming months.  The report covers the UK population as a whole, as well as the four individual nations of the UK. Within England, it identifies the regions where the impact has been greatest.

The tracker monitors levels of anxiety stemming from financial issues and the use of, as well as potential need for, money guidance, debt advice or further support from government or other agencies. The report identifies the numbers of people using government support such as the jobs retention scheme and support for the self-employed and those facing a drop in income that are not covered by either of these measures. It provides a regular picture of how the nation is responding to the economic shock created by the crisis.