Financial Wellbeing in February 2025

Summary

• Consumer confidence in the future UK economy increased in the month to February 17th, but with only 16% of consumers thinking the UK economy will get better over the next 12 months and 57% thinking it will get worse, sentiment remains deeply pessimistic. Confidence in future household finances also increased this month, but again more people are pessimistic than optimistic, with a net score of -8. 
• Financial worries are making people think twice about spending. This month, three in ten (28%) adults in the UK stated that they did not make major purchases in the last month, specifically because they are worried about their future household finances. 
• Many consumers (29%) believe their household finances will improve or stay the same but believe the UK economy will worsen. This tends to be because they believe their income or ability to save will help their finances remain stable or improve, but they expect the economy to worsen because of economic policies and inflation. 
• Household financial difficulty worsened in the month to February 17th, with missed payment rates increasing to 7.6% and financial adjustment rates increasing to 51%.
  
  

You can view more data and articles from our monthly tracker survey on our dedicated Consumer Insight Tracker page.

Consumer worries about future finances hold back spending

Consumer confidence in the future UK economy increased in the month to February 17th, but with only 16% of consumers thinking the UK economy will get better over the next 12 months and 57% thinking it will get worse, sentiment remains deeply pessimistic. 

Consumers’ confidence in their future household finances also increased, by seven points to- 8, with 31% of people expecting their finances to worsen and only 23% expecting it to get better. 

While these increases partially reversed recent declines in confidence, consumers continue to be downbeat overall and a net positive score hasn’t been recorded for either measure since July 2024. 

This negative sentiment appears to be impacting consumer behaviour with financial worries making people think twice about spending. This month, three in ten (28%) adults in the UK stated that they did not make major purchases (e.g. furniture, electrical/electronic devices, car etc.) in the last month specifically because they are worried about their future household finances. 

This is despite consumer confidence in their current household situation holding up reasonably well. It dropped by just two points to +21 this month. 

Consumer confidence in their future household finances increased to -8,  in the month to February 17th

Consumers typically express less confidence in the future UK economy than their own future finances, but the gap between these measures has widened in recent months. This month 29% of consumers told us they expected their future household finances to stay the same or get better, but for the UK economy to worsen.

The reasoning for this tended to be that they believed that they would benefit from higher wages, an ability to save and financial management, but anticipated a worsening future economy due to the effects of economic policies and inflation.

‘’ I have secured a better job, but the UK economy could worsen due to inflation.’’ Male, 38, South East

‘’My household finances can be controlled by how hard I work and will not be detrimentally affected by the economy worsening.’’ Male, London, 18-25

‘’Most of the household is due for a salary raise which surpasses inflation. I am worried about the trajectory of the economy due to booming house, food and energy prices’’ - Female, 20s,  East Midlands

Financial difficulty increases

Indicators of household financial difficulty worsened in the month to February 17th. The proportion of households missing a household bill, loan or credit card payment, mortgage payment or rent bill in the month to February 17th increased by 1.9 percentage points to 7.6%. 

When looking closer at the type of missed payment, the proportion of households that reported missing a mortgage payment increased this month to 3.4%.This represents the highest level of missed mortgage payments since August 2024 (at 3.7%). 

Additionally, the proportion of households having to make an adjustment to cover essential spending has increased by six percentage points from 45% to 51%. Adjustments include cutting back on essentials, dipping into savings, selling possessions or borrowing.

The missed payment rate increased to 7.6% and the financial adjustment rate increased to 51%

Methodology 

The fieldwork was conducted by Yonder on behalf of Which between the 17th and 19th of February 2025. A sample of 2,082 UK adults were surveyed online and weighted to be nationally representative.