Since the onset of the cost-of-living crisis, 8% of people have borrowed more, while a further 6% started borrowing for the first time, according to figures released by Hargreaves Lansdown.
The research, conducted by Opinium on behalf of Hargreaves Lansdown, found that various groups were more likely to have stepped up their borrowing, including younger people, women, renters, and parents.
More than one in 10 (13%) single people were force to borrow more, compared with 6% of married couples, demonstrating the difference for those having to deal with bills on their own at a time of rising costs.
Altogether, 26% of parents had increased borrowing, with 14% starting for the first time and 12% increasing their amounts.
Some 16% of those aged 18 to 34 started borrowing for the first time and 14% had increased their amounts.
Sarah Coles, head of personal finance at Hargreaves Lansdown, said: “It has officially come to the crunch.
“Prices have been rising for so long that millions of people have spent their way through the extra cash they built up during the pandemic and are being forced to borrow.
“Millions more were already borrowing, and have fallen even deeper into the red – and some groups are suffering particularly badly.”
She added: “Women are going deeper into debt…This is likely to stem from the fact that on average women tend to be on lower incomes, and we know from ONS data that the lower your income, the more likely you are to be borrowing now than you were at the same time last year.
“Younger people are also struggling…They tend to be on lower incomes, and are meeting rising costs on all sides.
“The average age of a first-time buyer outside London is 33, so most of these people are renting.
“Given how rent dominates their spending, and has been rising alarmingly – hitting an average of £1,190 a month outside London – it’s hardly surprising that 13% of renters have started borrowing more.”
Meanwhile, other groups ceased borrowing altogether, particularly men and high earners.
More than a fifth (23%) of higher rate taxpayers stopped borrowing and 16% cut back, while 19% of men stopped borrowing.
Coles said: “The HL Savings & Resilience Barometer has always shown that higher earners tend to borrow more – and more as a percentage of their income.
“However, this separate survey shows that at the moment, an awful lot of them are reconsidering their approach.
“They recognise that now isn’t the time to over-extend themselves, and where they have the cash to live within their means, they’re doing so more.”
She added: “But it’s not just high earners who are trimming their borrowing. There are also plenty of people who recognise the risk of borrowing as rates rise, and an awful lot who have spent their way through all their available credit and hit the wall.”
Coles said: “Overall, 10% have cut back on borrowing and 15% have stopped altogether. Among those aged 18-34, 17% have stopped borrowing and 13% have cut back on it.
“This is unlikely to be because younger people suddenly find themselves with plenty of money, and is instead more likely to be a realisation that borrowing to cover non-essentials is only going to make it more difficult to cover the cost of the basics in future.”
