Workers earning under £40k say they can’t afford children

New data from the Vanquis Financial Wellbeing Index has shown that these people lack the confidence to have children or grow their families, with many taking on second jobs and cutting back on non-essentials to cope financially.

The report shows that only 14% of householders earning under £40,000 feel confident in their ability to afford having a child or expanding their family. Whilst only 26% feel confident in being able to take two months off with no pay, and only 21% could handle a £200 increase in mortgage or rent payments. 37% of this group report working more hours, 33% have taken second jobs, 73% are cutting back on non-essentials, whilst 41% of UK householders earning under £40,000 say their mental wellbeing is impacted by their financial situation.

Rising bills may be contributing to these money worries, with essential spending for this group rising steadily over both the short and long term. Data shows water bills have risen by 10% over Q3 2025 and 48% over the two-year period up till October 2025, with the Government yet to rule out bigger rises down the line.

In addition, spending on insurance premiums, mortgage and rent, and groceries has all risen by over 10% over a two-year period. Energy bills are the only essential spending item that has seen relative stability, remaining flat over the two-year period, with a recent 4% decline.

Despite these persistent cost pressures, some do have a financial buffer of 11% at the end of each month (down from 12% last quarter, but up from 9% YOY), thanks to income mostly keeping pace with a rise in spending levels. However, individuals’ savings rates are low, at only 1.81% a month (up from 1.48%), slowing progress on building financial resilience and likely leading to the low levels of confidence seen in the data.

Ian McLaughlin, CEO of Vanquis Bank said “This new data from the Vanquis Financial Wellbeing Index shows that the ongoing cost-of-living squeeze is taking its toll on hard-working Brits, with rising bills eroding financial confidence and creating uncertainty about the future. This is impacting key life decisions, such as the choice to have children or grow their families, and driving many workers to take on second jobs or make sacrifices in their spending.”

“While some workers may finish the month with financial headroom, much of it isn’t being saved. This preserves short-term flexibility but prevents long-term resilience. Simple saving habits – even modest, regular amounts – are crucial for building confidence and establishing lasting financial wellbeing.”