How the cost of living crisis has affected families

With rising prices of everyday essentials such as household bills and food, it’s no surprise that the cost of living crisis continues to cause difficulties for families across the UK. In fact, we’ve already revealed the cost of having a family during the cost of living crisis.

On top of this, we’ve also conducted research to find out exactly how financial difficulties have affected families, the pressures faced by Brits due to their financial situation, and how the cost of living crisis has affected families’ mental health.

The impact of financial concerns on the family dynamic

Understandably, the cost of living crisis has left many families stressed out by their financial situation. However, according to the research, a quarter of Brits (26%) said that they still don’t want to talk about their financial situation with those closest to them.

Here at Lowell, we understand that it can be tricky to start a conversation about finances, but speaking with others can be productive. This is highlighted in the research as 21% told us that they do often talk about their tough financial situation with family members who are also helping out as much as they can. If you’re not comfortable speaking about money problems with your family, then there are lots of other independent financial advice and support options available who will be able to offer you the guidance you need.

It seems the cost of living and everything else that comes along with it is having effects on the entire family as 19% of survey respondents said that their partners are worried about their finances along with 9% of parents. Not only that but perhaps even more worryingly, 13% said that even their children are worried about the family finances.

Of those we spoke to, almost 90% admitted that their tough financial situation has affected relationships within the family somehow, and 7% even claimed that money issues had resulted in fallouts with family members.

Pressures faced by Brits due to their financial situation

Money problems have only been heightened during the cost of living crisis leading to many being more conscious about their finances and what they can afford. Of course, if friends and family are unaware of your financial situation and concerns then this could lead to added pressure due to a lack of understanding. But what exactly are the things that Brits feel pressured to spend money on?

Over a quarter of parents (27%) said that they feel pressure from their children to keep up with buying them the latest tech and fashion which can certainly easily eat up a large chunk of their money.

Additionally, 21% feel that there is some pressure coming from their friends in regard to arranging holidays or trips away together. Another 20% feel judged when it comes to buying presents for special occasions such as birthdays and weddings.

It isn’t always pressure coming from someone in particular either as 18% of Brits told us that they’re conscious themselves that their income isn’t as high as their friends’ and families’. What’s more, 8% are concerned about their own budgeting ability as well.

There are some other more specific things that Brits are worried that they may be judged for as well including not being able to send their kids on school trips (14%) or not having the money to attend a wedding, stag, or hen party (14%), and ensuring their parents are cared for properly (12%).

Lowell’s tips for starting a conversation about money with family

At Lowell, we understand that opening up about your financial situation with those close to you can be difficult as there is a certain stigma surrounding it, but we want to challenge this. As part of our goal to promote discussions about money, these are some of our tips you can use for talking about finances with those closest to you.

How to talk to your partner about money problems

• Be honest – Often it’s said that honesty is the best policy, and this really is the case when discussing money problems with your partner. This is because you might have shared finances therefore any issues are going to impact both of you.
• Don’t start placing blame – When approaching the conversation, you don’t want your partner to feel as though you’re putting the blame on them. Instead, focus on how you can potentially improve your financial situation together.
• Look into your options – During the conversation, take some time to discuss your options together to see which you can look further into. This means you can decide which solution would work best for both of you and are happy to take the necessary next steps.

How to talk to your parents or other family members about money struggles

• Practice beforehand - One way you can make sure you stick to your point is by having a little practice beforehand which allows you to go into the conversation with an idea of what you want to say and how.
• Pick a safe space to talk – It’s always easier to have tricky conversations somewhere that you feel comfortable. That’s why you might want to choose to chat with your parents somewhere where you can all be as relaxed as possible whether that’s at their home, your home, or on a walk. All that matters is picking somewhere private.
• Be mindful – Money can be a sensitive topic of conversation so it’s important that your parents or other family members understand that you’re not asking them for money but instead advice and guidance.

Talking to children about money

As for tips on starting an open conversation with children, the best thing to do is be honest and use this as an opportunity to teach them about basic finances at an early age. Our blog on the financial tips we wish we’d learned as a child touches on this in even more depth.

Where else to seek financial advice and support

We completely understand that the cost of living crisis has had a massive impact on families everywhere, especially when it comes to paying debt. If you’re a customer of Lowell and are struggling with your debt with us, please get in touch and speak with our friendly team. Once we’ve heard from you, we’re able to take a look at your personal situation and see who we can best support you and work together.

Alternatively, there are lots of other free and unbiased organisations you can contact if you need additional financial support and advice.

Published by Stephanie North-Shaw on 10th May 2023