Young adults are falling behind on bills – but you can take back control

Nearly half of young adults are struggling to cover basic living costs, with many falling behind on essential bills like rent, energy and council tax.

Our under 25s client analysis (2023–2025), based on 14,278 young adults who sought advice over the three-year period, shows the financial pressure facing young adults across the UK.

• almost 1 in 2 young adults (48.8%) are struggling with priority debts, including rent, utilities and council tax
• young adults now owe an average £7,218 each, a 12.5% increase since 2023
• more than 2,500 under 25s were unable to cover basic living costs
• 5,782 sought debt advice in 2024 alone

Our research also found that buy now, pay later (BNPL) borrowing is playing a growing role in financial difficulties among young people.

Buy now, pay later use is surging

Young adults are increasingly relying on modern credit products to get by, with BNPL use rising between 2023 and 2025.

Our findings show:

• the average number of BNPL accounts per person rose by 50%, from two accounts to three
• more young adults are turning to flexible borrowing to manage day-to-day spending

More young adults are reaching out for help

Demand for debt advice has also risen in recent years.

• in 2024, 5,782 under 25s sought debt advice, a 72% increase compared to 2023
• in 2025, the number fell slightly to 5,127, but remained 52% higher than 2023 levels
• the figures suggest many young adults are still feeling the delayed financial impact of the cost-of-living crisis

There are signs things are improving

While financial pressure remains high, the research also points to some encouraging changes.

Priority debts are falling

Fewer young adults are falling behind on essential household bills.

• priority arrears dropped from 68.6% to 48.8%
• fewer young adults are struggling with rent and mortgage arrears
• pressure around gas, electricity and council tax bills has eased for some households

Financial pressure is starting to ease

Young adults are also beginning to regain more control over their finances.

• the average monthly budget shortfall improved from minus £144 to  minus £49
• the gap between income and spending is narrowing
• more young adults are finding ways to better manage their money

Simple ways you can take control of your money

If money's tight, small changes can make a big difference.

Here are some practical ways you can start improving your financial wellbeing without cutting out everything you enjoy.

Make saving feel achievable

Saving money doesn’t have to feel boring or impossible.

According to the 2025 NatWest Savings Index, 74% of Gen Z are trying social media-inspired savings challenges. Whether it’s a ‘£1-a-day’ challenge or a month without online shopping, turning saving into a small personal challenge can help keep you motivated.

Try no-spend days

No-spend days can help you reset your spending habits.

Pick one or two days each week where you avoid unnecessary spending, including no takeaways, impulse buys or late-night online shopping.

It’s not about depriving yourself. It’s about helping you become more aware of where your money goes and breaking automatic spending habits.

You could use those days to:

• cook at home with friends
• go for a walk
• watch a series you’ve been meaning to catch up on
• find free events or activities nearby

Don’t be afraid of ‘loud budgeting’

More young people are becoming open about money, and that’s a good thing.

The NatWest Savings Index found 86% of Gen Z feel comfortable talking about their finances. A growing trend known as ‘loud budgeting’ encourages you to be honest when something isn’t in your budget.

Saying “I can’t afford that right now” shouldn’t feel embarrassing. Setting boundaries around money can reduce pressure, help you spend more intentionally and even encourage your friends to do the same.

Set goals that actually motivate you

Saving becomes much easier when you know what you’re working towards.

Whether you want to:

• build an emergency fund
• travel
• buy a laptop
• move into your own place
• feel less stressed about money

Having a clear goal can help you stay focused when spending temptations pop up.

Focus on paying off expensive debt first

Debt can quickly become more expensive if interest keeps building up.

If you can, start by paying down high-interest borrowing first, such as credit cards, while continuing to make minimum payments on everything else.

Even small extra payments can make a difference over time.

Spend more intentionally

Every tap, swipe and click adds up.

Before you spend, try asking yourself: “Do I actually want this, or am I buying out of habit?”

Tracking your spending for even one week can help you spot areas where you could cut back without feeling like you’re missing out.

Celebrate progress

Managing money shouldn’t mean cutting out everything you enjoy.

If your budget is too strict, it’s much harder to stick to long term. So when you hit a savings goal or stay on track for a month, allow yourself a small reward.

That could be:

• a coffee you love
• a meal out
• a small treat you’ve been wanting

Financial wellbeing isn’t about guilt. It’s about creating balance and building habits that work for you.