Quarter of Brits with 'debt worries' during 'pay freeze'

New research from price comparison website uSwitch.com indicates fewer than three in ten workers expect a pay rise this year, but living costs are still rising. Meanwhile, around one quarter of British people are trying to figure out how they'll repay personal debts.

Around two thirds of workers (65%) have had a pay freeze in recent years - while 15% haven't seen a pay rise in at least three years. This is causing serious problems for people all across the country, as pay is not keeping up with inflation.

Only 30% of people who work expect a pay rise, and even those lucky ones may only get 2.1%, on average - around half the rate of inflation at the moment.

Of the people expecting pay freezes this year, around half of them will cut back on discretionary spending and two in ten will try working longer hours or starting a second job to boost their income.

Rail fares went up 5.9% on average at the start of this year, and energy bills by 21% last year (although EDF recently announced a 5% drop and other energy companies are expected to follow suit). No wonder 76% of us are worried about the cost of living.

While one quarter of consumers are concerned about existing debt, there are real fears that pay freezes and the rising cost of living could push more people over the edge of their finances.

A spokesperson for debt management company Gregory Pennington commented: "Anyone concerned about their existing level of debt may be able to regain control of the situation by reining in spending, or increasing their income in some way. Where this is not an option, seeking advice from a debt expert is a sensible next step."

Lucy Bower