More than half of UK adults are looking for ways to increase their income due to the cost of living crisis.

Research from insurance specialists Canada Life shows that 28.9 million (55%) workers are trying to find other ways of raising money, whether it's looking for extra work or selling assets.

The top ways UK adults plan to boost their income are by selling unwanted belongings (36%) or looking for higher-paid jobs (28%).

A further 23% of adults are looking for a second job to build on top of their current income, while 22% plan on using their savings and investments to supplement their income.

The survey showed 13% of the people asked are planning to access their pension savings earlier than planned, and a further 10% have, or are considering, releasing equity in their home.

Increased credit card lending and borrowing

The number of people using a credit card or increasing their limit has also risen to by 13%, while 9% have or are considering increasing their overdraft.

Bank loans have also increased, with 8% of UK adults applying or looking to apply to borrow money.

In February 2022, the Bank of England (BoE) said that credit card lending had jumped by £1.5bn to a total of £59.5bn as the cost of living crisis started to take hold of the UK economy.

This figure shows the highest record of credit card borrowing since records began in 1993, pushing the total amount of unsecured lending up by 90% on the previous month to £1.9bn.

Andrew Tully, technical director at Canada Life, said:

"The cost of living crisis is causing the majority of people to re-evaluate their financial situation. And, with inflation set to reach double digits later this year, we can expect to see more individuals tightening their belts and looking for additional ways to supplement their income.

"However, with the research showing that over one in ten adults are looking to access their pension early, we, as an industry, need to ensure that these individuals are aware of the tax and cost implications of doing so.

"Not only will your pension have to stretch further into the future, you are likely to pay tax, and you can also trigger the money purchase annual allowance."

Inflation is set to increase further

Over the course of the year, inflation has been quickly increasing and is expected to rise further towards the end of the year.

The UK consumer price index released in August by the Office for National Statistics showed that inflation rose to 10.1% in the 12 months up to July, up from 9.4% in June.

The main factors which are shown to be the cause of the rising inflation are:

• energy bills
• petrol and diesel prices
• food prices
• increases in price of raw materials and household goods.

The BoE's monetary policy committee (MPC) had planned to announce the next interest rates decision on 15 September but postponed it due to the death of Queen Elizabeth II.

It is widely expected that the interest rates will once again increase from 1.75% to 2.25%, a further 0.5% hike similar to that of the previous announcement.

The next official announcement from the MPC is due to take place on 22 September.

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