Britons Missing 15 Million Bill Payments Per Year

March 4, 2014

Luke-Notley small (Custom)One in five people has missed a bill payment in the past year, according to new research.

The research from comparison site found bills worth £882 million went unpaid in 2013, equating to £175 per household.

The research found credit card and loan repayments, childcare costs and mortgage/rental payments were the most common bills that went unpaid.

UK households collectively spend £33.7 billion on essential bills per month, equating to £1,360 per household. Of that figure, one in four of those surveyed said they are paying more than £500 a month on mortgage or rent payments, with 5% spending in excess of £1,000 just to be able to stay in their home.

Around four in 10 (43%) of those surveyed admit to having incurred extra charges and interest payments on missed payments, while almost one in five (18%) say their credit score has taken a hit and nearly one in 10 (8%) have been served with a County Court Judgement (CCJ).

Clare Francis, editor in chief at MoneySuperMarket, said: “Many households are precariously juggling their bill payments, choosing which to pay and which to ignore. It’s a balancing act that can’t continue long-term without significant implications.

“Worryingly, one in five people say their outgoings would only have to go up by £50 a month (or less) for them to struggle even more. Given interest rates are likely to start rising next year, leading to increases in the cost of borrowing, it is a real concern that many people won’t be able to cope.

“It’s when times are tight that we need to be the most open and honest about paying bills, and absolutely not retreat into denial. Working out monthly outgoings and budgeting is crucial.”

People have different strategies for coping with household bills – two-fifths will cut back on basic spending, while one in five will cut back on spending on other bills and, more worrying, one in 20 simply ignore the problem. Two-fifths say they missed a bill payment because they simply couldn’t afford it, while a third missed paying one bill because they had to prioritise another one.

Another strategy people use to cope with their bill payments is waiting to the last minute to pay, with 16% polled admitting they do this. A further 12% admitted they plan to pay bills late in the next four weeks, rising to 22% in the 18 to 34 age group.