Cost of living rises among most cited reasons for debt among StepChange new clients

The increased cost of living was among the three most commonly cited reasons for debt among new clients at StepChange Debt Charity in March 2022, with 13% citing it, the charity said in its monthly client data report for that month¹. In September 2021, 7% of new clients cited it as a main reason for debt¹.

Almost 15,000 new clients received full debt advice from StepChange in March 2022, a rise on previous months¹. March also saw the highest proportion of clients with a negative budget over the previous six months, at 33%, up four percentage points from 29% in January¹. A negative budget means a household's income does not cover its essential outgoings.

StepChange said:

The charity said there had been a small increase in the proportion of new clients with arrears on their gas bills, but no substantial rise in clients behind on energy bills over recent months¹. Credit cards remained the most commonly held debt type among new clients, and council tax the most commonly held household arrears type¹. StepChange said it continued to advise a disproportionate number of single parents, women, younger age groups and clients renting their homes¹.

Later figures show how the numbers developed. Across the UK, 183,403 new clients completed a first full debt advice session in 2023, up from 167,351 in 2022, which the Scottish Government described as the equivalent of one new client every three minutes². Between 2022 and 2023 StepChange provided full debt advice to 16,000 more clients, a 10% year-on-year increase². Monthly UK data for April 2024 showed 16,046 new clients seeking debt advice, 11% higher than the 14,512 in April 2023².

Average unsecured debt among StepChange clients across the UK was £14,654 in 2023, up from £11,000 in 2021². Among Scottish clients it rose from £12,730 in 2021 to £16,337 in 2023². Client average arrears increased 30% between 2019 and 2023, the highest level in five years².

By 2024, a cost of living increase was the most common reason for debt among StepChange's new clients, cited by 21%, according to a University of Bristol report published in October 2025³. That report said 170,928 clients completed a full debt advice session in 2024³, and that in June 2025 three in ten (29%) StepChange clients reported a negative budget³.

Why it matters for households

The figures describe who was seeking help and why, not the whole picture of household debt. The Scottish Government review notes that debt service figures do not reflect people in debt who do not seek advice, and cites FCA research that only 21% of adults who felt heavily burdened by their debts and 29% of those who had fallen behind on or missed bill payments sought help in the last year². It also notes that some services count only new clients while others count new and existing clients, and that figures may understate need where services are overstretched².

The same review found that in 2023, 39% of UK adults either needed debt advice or were at risk of needing it soon, and 15%, equivalent to 8.1 million people, needed debt advice to avoid their situation worsening². It said 21% of people had borrowed to pay for essentials in the last six months², and that 59% of new clients at Christians Against Poverty in 2023 had an equivalised income below the poverty line².

For households already in arrears, the Bristol report found that 91% of surveyed StepChange clients with energy debt were already behind with their energy bills when they sought advice, 75% had arrears on other household bills and 75% owed money on consumer credit³. It said 55% of StepChange's new clients have a vulnerable characteristic in addition to their debt problem³.

What happens next

The Bristol report, published in October 2025, sets out six longer-term ambitions and eight "quick wins" for improving referrals from energy suppliers into debt advice³. These include energy suppliers pausing collection activities while a customer is seeking debt advice and acting on it, and adopting the Standard Financial Statement for producing and accepting customer income and expenditure statements³. It also notes that Ofgem put in place new and updated rules at the end of 2023 to make it easier for domestic customers to contact their supplier³, and refers to a new Consumer Energy Debt Advice service led by Citizens Advice with the Money Advice Trust and StepChange³.