Context

The Financial Fairness Tracker study is a partnership between the University of Bristol’s Personal Finance Research Centre and abrdn Financial Fairness Trust. Twice each year, people from across the UK are asked about how their personal and household finances have been affected by the economy. This report focuses on the findings of the 11th edition of the Financial Fairness Tracker in relation to the UK as a whole.

At the time of the Tracker’s 11th edition in Autumn 2024, many households across the UK were expecting to be worse off. The recently published budget included a withdrawal of the universal Winter Fuel Payment for older people.

The study

Funded by abrdn Financial Fairness Trust, the Financial Fairness Tracker was designed and analysed by the Personal Finance Research Centre.

In each edition, the survey uses a standardised methodology and defines a composite Index of Financial Wellbeing which identifies four groups:

• in serious financial difficulties (scoring 0-29)
• struggling (30-49)
• exposed (50-79)
• financially secure (scoring 80-100).

The data for this edition were collected in November 2024 using Opinium’s nationally and politically representative online survey panel, providing a UK-wide cross-sectional sample of 5,804 households (represented by one person from within the household with responsibility for their household’s finances). Addressing the picture for the UK as a whole, the report explored:

• the financial wellbeing of households
• the groups who were doing better and worse
• how households were making ends meet
• the future outlook for households.

Key findings

Financial wellbeing in autumn 2024

There was a small decline in the financial wellbeing of UK households since May 2024, driven by:

• a decline in the proportion who were ‘financially secure’ (25%, down from 28%) and
• an increase in ‘exposed’ households (36%, up from 34%).

44% of households were unable to cover an unexpected bill equivalent to one month’s income (down from 47%).

The picture for certain groups

• The overall picture was driven largely by a decline in the proportion of pensionable-age households feeling ‘financially secure’ (40%, from 49% in May 2024).
• 47% of low-income pensioner households said they were worried about meeting their energy bills in the next three months (up from May 2024, 30%, and October 2023, 38%).
• Nonetheless, a greater proportion of older households were ‘financially secure’ in November 2024 than working-age households (17%), a trend which persisted from previous editions.

Households with children

• 48% of households with children were ‘struggling’ or ‘in serious difficulties’ (rising to 62% of those with three or more children and 63% of those in privately rented homes), compared with 40% of working-age households without children.
• Only 4% of families with disabled children were ‘financially secure’ (compared to 17% of other parents).

Making ends meet

Among all households in November 2024

• 8% reported having used a food bank in last six months
• 12% had not been able to eat for a whole day on three or more occasions
• 19% had received financial help from family or friends
• 26% had borrowed to cover living expenses.

For each measure, this was higher for households in the bottom income quintile. Compared with October 2023, households overall were taking fewer measures to lower their energy bills.

The future outlook

51% of all households felt confident about their household’s financial situation for the following three months (the highest recorded in the Tracker since the June 2022, but still lower than in October 2021, prior to the cost-of-living crisis).

Points to consider

Methodological strengths or limitations:

• The authors describe the samples as being designed to be nationally representative but do not detail the sampling or weighting strategies or population characteristics underlying this.
• The findings presented are largely descriptive. For example, multivariate methods of analysis were not used.
• Statistical significance testing of differences in tables nonetheless supports the rigour of the findings presented and, though not stated explicitly, the report implies that differences described in the text were all statistically significant at the 95% level of confidence (p<.05).

Applicability:

• The report should be of interest to policymakers, practitioners and advocates with an interest household financial wellbeing across the United Kingdom.
• The report is highly applicable given national goals to improve levels of financial wellbeing in the Money and Pensions Services’ 2020 UK Strategy for Financial Wellbeing.

Relevance:

• The report is relevant and timely given the rapidly changing UK economic landscape since 2020 (including the impacts of Covid-19 policies and the cost-of-living crisis) as well as political and policy developments in the UK in 2024.