No let-up for millions of families in hardship: JRF’s cost of living tracker, winter 2025

The 9th wave of our cost of living tracker survey, carried out by Savanta between 17 October and 7 November 2025, captures the experiences of 4,037 households with incomes in the bottom 40% in the UK, and shows that:

• more than half of low-income households have had to go without heating to reduce their energy bills
• over 5 million households have cut back on or skipped meals because they cannot afford food
• almost 4 million households have borrowed to pay for life’s essentials, and the large majority of these (70%) are currently arrears.

The acute hardship facing low-income families has seen little improvement from previous waves of the survey carried out in May 2025 and October 2024, and it promises to get worse. Despite the recent Budget helping to reduce the stress on low-income families through the scrapping of the two-child limit and lowering of energy bills, JRF modelling still projects these families will see a fall in their incomes after housing costs by the end of the parliament.

Bold and extensive action is required to address the scale of this challenge and prevent it from being a lifelong cost of living crisis for millions of low-income households.

Cost of living crisis still leaving millions of families on the edge

For 4 years, families across the UK have faced a cost of living crisis that has stretched household budgets and led to tough choices on spending decisions. For those on the lowest incomes, many of whom were experiencing hardship way before the crisis took hold, the choices are stark — whether to skip a meal or turn off their heating because they don’t have enough money for both.

JRF’s latest cost of living tracker survey shows that these choices continue to bear down heavily on low-income families. More than half of low-income families have heated their home less than they needed to reduce their energy bills (58%) or have reduced spending on food due to rising costs (51%).

In November the Government took the important and welcome decision to lift the two-child benefit limit to help reduce child poverty and give more children the best start in life. This change was vital with data showing 7 in 10 low-income families with 3 or more children had skipped meals or gone hungry in the last 30 days. However, bolder and more extensive action is required to make a difference to the living standards of millions of low-income families.

Over 7 million households continue to go without essentials

As we reported in November, our latest survey finds that 60% of low-income families have gone without essentials in the last 6 months, which is equivalent to 7.1 million households nationally. The number has now been 7 million or over for 4 consecutive years (Figure 1).

Right across the country, low-income families are going without basic necessities, with close to 1 million (930,000) families in the North West going without essentials in the last 6 months, over 800,000 families in London going without essentials, and around 700,000 families in Scotland going without essentials (Figure 2).

With such large numbers persisting for so long, it can be easy to become desensitised to what this actually means. To put it into context, it means:

• over 5 million families cutting back on or skipping meals because they do not have enough money for food
• over 2.5 million families not being able to keep their home warm because they can’t afford it
• around 2 million families not being able to afford to replace a broken fridge, TV or washing machine
• over 2 million families not being able to get essential dental treatment carried out because of the cost
• almost 1.8 million families not making an essential journey because they couldn’t afford it.

Food is the most common essential to go without

On food insecurity specifically, there were 5.4 million low-income families going hungry, cutting back on meals, or skipping meals in the last 30 days — a similar number to the previous 2 surveys — while 1.4 million low-income families have had to use a food bank in the last 6 months (Figure 3).

The number of families not being able to keep their home warm has dropped slightly (Figure 4), likely reflecting the fall in energy prices since 2023 and the reduction in the Energy price cap by 7% between 1 July and 30 September.

However, more than 2.5 million households still have not been able to keep their home warm. In that context, the announcement in the Autumn Budget that an average of £150 will be taken off the costs of household energy bills from April next year is welcome but not targeted on the households who need support the most. JRF has recently assessed a number of options to provide further support in a more targeted way, including through a Rising Block Tariff.

With the Food Foundation estimating that the price of a typical basket of food has increased by 27-30% since April 2022, with energy bills remaining £600 a year above their pre-energy crisis average, and well over 1 in 4 of England's adult population unable to access NHS dental care, families up and down the country are finding many essentials goods and services increasingly expensive. However, it is inevitably low-income families that find themselves least able to respond, and for many of them the cost of living crisis has turned everyday living into a matter of survival.

Large families and those on Universal Credit most likely to go without essentials

Large low-income families are significantly more likely to be going without essentials than the typical low-income household: 83% of households with 3 or more children went without essentials compared to 60% of all households in the survey (Figure 5). This is unsurprising as the two-child limit will have been limiting support for many of these families. The Government’s recent announcement to scrap the two-child benefit limit is welcome and should make a significant difference to these families. The Government’s announcement that families will be able to cover more of their childcare costs through Universal Credit (UC) is also welcome and will make it easier for parents to work and increase their income (although an alternative system, in which childcare costs are capped as a percentage of household income for working families would be simpler and more progressive).

It is clear that the UC system does not provide enough support to cover the basic cost of essentials: 83% of those claiming UC have gone without essentials in the last 6 months. This rises to 90% amongst those households who had money deducted from their benefits.

As such, these findings yet again highlight how imperative it is that the Government commits to an Essentials Guarantee in UC, to ensure there is a protected minimum amount of support to afford life’s essentials. Introducing a 'protected minimum floor' 15% below Universal Credit’s basic rate would be a quick and relatively low-cost step towards this. This would limit total deductions from debt repayments and the benefit cap to this level, creating a safety net below which no one should fall. 

In total just over 1 million low-income families have high-cost credit loans with loan sharks, doorstep lenders, or payday lenders, or have used pawnshops to pay for essentials in October 2025. This is down from 1.5 million in May 2025. A welcome drop, but still far too many families left to rely on high-risk lending to pay for the basic necessities.

Most families who borrow to pay for essentials end up in arrears

The precariousness of low-income families borrowing to pay for essentials is reflected in the high proportion that are unable to repay their debts. In October 2025 around 7 in 10 (69%) families that had used loans or credit to pay for food, housing (excluding mortgages) or other essential bills were behind on their debt, credit or bill repayments.

Millions of low-income families are in arrears on essential bills

Over 2 million low-income families are estimated to be in arrears on at least 1 ‘high-priority’ household bill (this includes rent or mortgage payments, Council Tax, and energy bills), a number that has remained the same for the last 3 waves.

Taken individually, there are 1.5 million low-income families in arrears on their electricity and gas bills (a number that has been rising gradually over recent waves), a little under 1.4 million families in arrears on their Council Tax, and 1.3 million behind on their water bills (Figure 7).

People in arrears on housing costs, falling increasingly behind

Although the number of low-income families in arrears on their mortgage is relatively low, this masks a worrying and growing problem.

Of all low-income families with a mortgage, 1 in every 8 are in arrears on their mortgage payments, and those who are in arrears are falling increasingly behind. The average mortgage arrears in October 2025 was £990, up from £870 just 6 months ago, and up from £725 from a year ago (Figure 8).

There is also a significant risk that this problem will continue to grow, with many low-income families due to see their mortgage costs increase over the next year when their fixed-rate deals come to an end. More than a third (37%) of survey respondents with a mortgage currently have a fixed-rate deal that started before October 2022, and many of these are likely to see their payments increase when they renew, due to the increase in interest rates since then.

Although less marked, average rent arrears are also up on 6 months ago, from £530 in May 2025 to £580 in October 2025, as are average Council Tax arrears, from £495 in May 2025 to £570 in October 2025. These increasing levels of arrears are extremely worrying when the potential consequences include families being evicted from their homes, enforcement action being taken, or court summons being issued.

Large families and those on UC amongst most likely to fall behind

The same types of low-income families who are least able to afford essentials are also those most likely to be behind on their bills. Those aged under 35 and those with 3 or more children are almost twice as likely to be in arrears as low-income families in general, while those from a black ethnic background and those on Universal Credit are around one-and-a-half times as likely (Figure 9).

Tackling the cost of living crisis is also central to the Government’s stated ‘number one mission’ of economic growth. Amongst low-income households who are in employment, a third say that the cost of living crisis has negatively affected their work life, reducing their ability to get to work, or to do their job effectively. That is equivalent to almost 2 million households, a situation that is unlikely to improve the UK’s downgraded productivity growth. Meanwhile, the survey also finds that around 4 in 10 low-income households have reduced spending on transport (41%) and clothing (42%), and that around 5 in 10 have reduced spending on gifts (49%), food (51%), and socialising (46%) (Figure 11). That is lower spending in shops and on services by a large proportion of households, reducing business revenue and dragging down economic activity and investment in the process.