A survey carried out by NMG Research for the Bank of England has revealed the extent to which UK households have had to tighten their belts in the face of higher food prices, soaring utility bills and a lack of credit.
The study, which collected data in late September and early October, involved around 2,500 households.
The typical household reported that the income remaining after meeting household bills had fallen over the past year. The majority had also saved less than expected.
Only 3% of the households surveyed had fallen behind on bills or debt payments but of the 97% able to keep up with their financial commitments, 33% complained that they struggled to make the payments, from time to time.
The 3% of households that were slipping behind were predominantly tenants or had mortgages with high loan-to-value ratios.
Total household debt in the UK now stands at around £1.6 trillion, according to the Bank, and over 50% of UK households now have some kind of unsecured debt.
The study also found that the number of homeowners who owed more than £90,000 in secured debt has risen 35% since the mid-1990s.
The Bank summarised the findings by saying that after a period of growth and low inflation, it has seen an abrupt change in the circumstances facing British households.