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Understanding Financial Resilience In A World Of Uncertainty

Evidence type: Insight i


StepChange estimate that over three million people in Great Britain are in problem debt, with almost ten million showing signs of financial distress. The number of people in problem debt has remained at this level since 2013. Life events are the main trigger for experiencing problem debt, such as losing a job, the breakdown of a relationship, reduced hours at work, ill-health or becoming a carer. Previous research by StepChange in 2015 confirmed that people who experience these life events are at increased risk of encountering financial problems. It also showed that the coping strategies that people were forced to employ were increasing the likelihood of them slipping into long-term financial difficulty.

The study:

This 2019 insight report from StepChange debt charity represents the first part of a major new research initiative that explores how to break the link between life events and debt. This first stage of the research attempts to understand who is most at risk, and to pinpoint where current support may be failing to prevent people falling into problem debt. This research included a review of existing evidence, as well as analysing the results of a national survey.

The survey was a large national online poll conducted by YouGov. The poll contained responses from 5,326 adults. Fieldwork was undertaken in April and May 2019, and is weighted to be representative of the UK adult population (aged 18+). Some figures in the report are scaled-up to represent national figures. These figures are based on 2017 population estimates from the Office for National Statistics, which indicated that there were just over 50 million adults in Great Britain.

Key findings:

  • The support network people rely on is often not effective enough to keep them out of problem debt. While there have been some welcome initiatives in the past few years such as the introduction of Help to Save, it has come against a backdrop of squeezed welfare benefits, including:
    • The working age benefits freeze;
    • Cuts to the work element of Universal Credit;
    • The introduction of a two-child limit for support through child tax credits and the child element of Universal Credit.
  • A combination of low levels of savings, increasingly precarious work patterns (zero-hour contracts, irregular guaranteed hours, etc.), and often having to turn to credit to make ends meet means it is harder for people to build any sort of financial resilience to guard against unexpected life events.
  • Almost half (45%) of people say that they or someone in their household has experienced a life event in the past two years. Over 2.5 million people reported having reduced hours at work, while 4.5 million reported being made redundant or becoming unemployed.
  • The research found that those at the most risk of problem debt as a result of life events included parents, lower and middle income households and renters.
  • In 2018, seven-in-ten people who approached StepChange for advice cited financial difficulties caused by a life event as their primary reason for reaching out.
  • People who had experienced a life event in the past two years were three times as likely to be in problem debt as those who had not experienced a life event/shock.
  • The research shows that the more life events someone has experienced, the more likely they are to encounter problem debt. People who had experienced two life events in the past two years were four times more likely to be in debt than those who experienced none, while those who experienced four or more life events were ten times more likely.
  • The higher the number of coping strategies people use, the more likely they are to be in problem debt. Almost a third (32%) of people who were using five or more coping strategies (such as accessing credit, using savings, taking money from pension pots, etc) were in problem debt.
  • The most frequently used coping strategies included getting a payday loan or using other high-cost credit (53%), negotiating with creditors to reschedule payments (44%), using credit cards or overdrafts (35%), borrowing from family and friends (30%), and/or applying for more benefits (29%).
  • Going forward, StepChange intend to establish what works and what doesn’t in relation to breaking the link between life events and problem debt. It will look to establish principles for the support people should expect to receive following a major negative life event, and make recommendations for change to help implement an improved support network.

Points to consider:

Methodological strengths and limitations:

  • These findings are taken from a YouGov online poll that is designed and weighted to be representative of the population of Great Britain.
  • The population of Northern Ireland was not represented in this research.


  • This report is particularly relevant to anyone with an interest in financial resilience and coping strategies for problem debt.

Generalisability/ transferability:

  • The results of this research can be seen as an accurate snapshot of trends and drivers of financial resilience within the British population.

Key info

Year of publication
England, Scotland, Wales
Contact information

StepChange Debt Charity, Grace Brownfield