67% of households with children say COVID-19 will have long-term impact on finances

Jessica Bird

May 11, 2020

More than two-thirds (67%) of households with children think the economic impact of the COVID-19 pandemic will have a long-term effect on their household finances.

This is in comparison to 51% of the general population, according to comparethemarket.com’s Financial Confidence Tracker research.

More than a third (36%) of families with children think they will have to make financial sacrifices for six to 12 months after the lockdown ends.

Only a quarter (25%) of the general population predict they will have to do this.

18% of households with children feel the long-term impact will be very negative, compared to 16% of the wider population.

The number of people who struggled to pay household bills increased from 17% to 18% in the last week, while the proportion who are not confident that they will be able to keep on top of payments in the coming weeks remained at 20%.

The number who said their working circumstances had changed for the worse jumped from 39% to 45% over the past week. Similarly, the proportion of people struggling because their income is not enough to cover their outgoings increased from 38% to 43%.

London has the lowest financial confidence of any UK region, with 27% of people unsure that they will be able to meet the demands of their household bills in the coming weeks

Those in the West Midlands saw the biggest dip, with the number of people saying they are not confident in paying bills over the coming weeks rising six percentage points from 14% to 20%.

Anna McEntee, product director at comparethemarket.com, said: “Household financial confidence in the wake of the pandemic remains low across the UK, and there is evidence that the impact of COVID-19 is having a very real – and increasing – impact on consumers, many of whom are finding that difficult job prospects mean it is harder to stay on top of bills and household finances.

“The number of people who struggled financially over the past seven days has increased, albeit marginally, and the proportion who expect these worries to continue remains flat, suggesting we have some way to go before the nation starts to feel back in control of their money.

“The fact that so many households with children expect to make financial sacrifices for years to come shows the stark impact of COVID-19 on our lives for the long-term, especially for those who need to look after dependents.

“With the national conversation increasingly focused on what an exit out of lockdown might look like, there is hope that some businesses may soon re-open.

“However, with more people this week than last week saying they would not be confident going to cafes and restaurants, it may be difficult to persuade the public it is safe to switch back to ‘normal’ life and, consequently, that the economic recovery will be a gradual rebuild rather than a sharp rebound.”

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