Research reveals that more than half of all Britons are currently finding it difficult to meet their commitments on bills and credit repayments.
According to the Money Advice Service, 52% of people are struggling to keep up – a 17 percentage point increase from 35% in 2006.
Many of those surveyed appear to lack even basic banking skills, as one in six were incapable of identifying their current bank balance on their statement.
Long-term financial planning may also be beyond some people, with a third of those surveyed uncertain of what effect inflation has on the value of their savings.
In spite of this, it seems many people are working hard to keep their finances on track, and many are even managing to add to their personal savings pots.
The survey found 84% of people routinely keep track of how much money they have; 85% save when they can, and 53% save every month; and 46% of people have a conscious personal budget in their mind.
Caroline Rookes, chief executive of the Money Advice Service, says: “In theory, money management is easy – spend less than you earn and consider your future, but the difficulty comes when applying this in the real world.
“This report reveals just how difficult it is at the moment for so many of us, but also highlights ways we are adapting to manage financially.”
Some 62% of respondents agreed with the statement “I always make sure I have money saved for a rainy day”, while a further 20% neither agreed nor disagreed, or simply did not know their response to the question.
Tellingly however, the report quotes one respondent as saying: “There is no point saving when you have got a loan. It would be topsy-turvy financially.”