5 money problems (and how to avoid them)

We’ve put together a list of 5 common money problems, and what you can do to avoid being part of them.

1) 49% of UK households have never checked their credit report

This figure is truly surprising! Checking your credit report is really easy and it's very important for your financial health. Plus, it's free – so there's no reason not to do it!

Your credit report contains your personal and financial information that lenders look at when you apply for credit. Mistakes on your report could stop you from getting approved for credit, but you can avoid this by simply reviewing your details and fixing any errors.

2) 1 in 4 families have little or no savings

According to a report by Money and Pensions Service (MaPS), 1 in 4 families have less than £100 in savings.

We understand saving is difficult, especially if you have a low income. But having even a small amount saved can be a lifeline when unexpected costs pop up, like a broken boiler.

Every little bit you manage to put aside can help build your financial safety net. Start with what feels possible for you, even if it's just a few pounds each month. 

3) 11% have fallen behind on paying their household bills

A report by the Financial Conduct Authority found that many people are behind on paying their basic bills, including gas, electricity and water.

If you don't make your payments, your suppliers might cut off your services and tell credit reference agencies about your late or missed payments. This could harm your credit rating.

We recommend setting up Direct Debits or payment reminders to make sure you never forget. If you're finding it hard to afford the costs, talk to your supplier and work out a payment plan that works for both of you.

4) 2,463 County Court Judgments (CCJs) are issued every day

That's nearly 900,000 every year! A CCJ is an official court order to make sure you pay back what you owe. A lender or company that you owe money to can go to court to get a CCJ after they've given you a default – usually when you've missed three or more payments.

You should try very hard to avoid getting a CCJ. It's one of the quickest ways to damage your credit score. If you get a bad credit history, you'll find it difficult to borrow money in the future and you'll pay higher interest rates if you do get accepted for credit.

Keeping up with your payments starts with good money management and budgeting.

5) 205 landlord possession claims and 42 mortgage possession claims are made every day

A possession claim is an action to take back a property. Your landlord or lender will make a possession claim if you've missed several rent or mortgage payments – also called payment arrears. However, this doesn’t happen overnight and they should give you fair warning before possessions take place.

Remember, if you’re struggling with debt, you’re not alone. There are charities you can speak with for free, impartial advice, so get in contact with them as early as possible.

• Citizens Advice 
• Money Wellness 
• MoneyHelper 
• National Debtline 
• StepChange 

Sources:

FCA - Credit Information Market Study Interim Report (November 2022)

The Money Charity – The Money Statistics (January 2024)

Government Website – Mortgage and landlord possession statistics (May 2024)