41 per cent of people expect their own financial position to worsen in the next 12 months, a new survey has found, as the economic impact of the coronavirus pandemic deepens.
Research from fund supermarket Hargreaves Lansdown found that 84 per cent of people expect the general economic situation in the UK to get worse over the next year, while one in five people are offering financial support to family and friends.
The survey follows the release of GDP data this week which showed that the UK economy shrank by 5.8 per cent in March – the fastest monthly pace on record – due to a crash in activity and demand.
In the first quarter, UK GDP fell by two per cent compared with the previous quarter, its largest decline since the financial crisis.
“It might not feel like it at times, but it’s our friends and family who are getting us through this crisis,” said Sarah Coles, personal finance analyst at Hargreaves Lansdown.
“One in four people are facing money worries, and our families are stepping in to help. Over the past four lockdown weeks, the number of people with financial concerns who say they’re helping their family or friends financially has risen from four per cent to 20 per cent.
“This is a lifeline for millions of people, and we’re only too happy to help those we love the most.
“However, if you’re in this position, you need to ask yourself a few questions to make sure you’re not building up problems for the future.”
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Coles said that people considering lending money to their loved ones should ask themselves whether they can afford it; when it is going to be paid back; what they will do if it is not repaid; how it will change the relationship; and how long they can do it for.