Around 70% of full-time employees in the UK say they are worried about their financial situation, according to new research.
This anxiety is further justified by the fact that 28% of full-time workers don’t feel confident about covering their expenses for one month in the event of falling ill and being unable to work, revealed the study from Vitality Life Insurance.
Around a third (34%) of part-time employees also worry that they won’t be able to meet their financial obligations if they become unwell. Similarly, 30% of gig-economy workers express concerns about their financial resilience in the face of ill-health.
The study, which surveyed over 2,000 people in the UK on how the cost-of-living crisis is currently affecting the UK, sheds light on the growing concerns of adults in managing their money and the potential loss of income due to ill health.
FINANCIAL CONCERNS
As many as 69% of respondents said they are worried about their finances, with 35% not feeling resilient when it comes to supporting themselves or their family. This may be due to the fact that 3 in 5 people reported an increase in bills since March 2022.
Over half of people (55%) worry about losing income if they aren’t able to work due to ill health. However, despite this, many people are leaving themselves unprotected with only 10% having income protection, 12% having critical illness cover and 27% with life insurance.
When looking at the impact of the cost of living on families, 43% of parents are worried about paying their mortgage. Additionally, 33% do not feel financially resilient, and 43% are worried about their ability to meet their mortgage payments. Single parents are at more risk, with 44% not feeling financially resilient. The majority of people in the UK feel their spending on bills has increased, with three in five saying it has increased since March 2022.
COST-OF-LIVING IMPACT ON WOMEN
Women are feeling more insecure about their finances. In fact, two in five women do not feel financially resilient. The ongoing crisis has disproportionately impacted women, leading them to feel more vulnerable and less financially resilient than their male counterparts. Around four in 10 (39%) of women report not feeling financially resilient, while only 30% of men share the same sentiment.
Moreover, 61% of women have reported an increase in expenses, compared to just 53% of men. In the last 18 months, there’s been a 14% increase in women being unable to save each month, which stands in contrast to men, who have seen a 9% increase.
COST-OF-LIVING IMPACT ON YOUNG PROFESSIONALS
The survey also found that many young professionals are still living at home. Over a third of under-35s say the cost of living has or will prevent them from leaving home. Additionally, 35% of those under 35 say the cost-of-living crisis has or will prevent them from moving out of their parents’ house, stymying their ability to reach other key milestones such as starting a family. This rises to 41% for those aged 18 to 24. The research also found that these milestones are often when people seek to take out life insurance. For example, 19% of those who had life insurance took it out when they purchased a property with a mortgage.
Commenting on the findings, Justin Taurog, Managing Director of VitalityLife, said: “It’s always tough for young people to save for their future but that’s being accentuated by the incredibly challenging financial situation many find themselves in at the moment. Our research shows that major milestones like buying a house are often a key catalyst to taking out life insurance. With these being set back, it’s more important than ever that as an industry we offer real value from our products to ensure people continue to take out protection to support them and their families.”
Click here to read the full report.
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