A further interest rate rise from the Bank of England in February is currently a cause for concern for around two in five (38%) individuals in the UK, a new study by Aegon has suggested.

Aegon’s findings, based on a study among 2,000 adults in the UK, indicated that an interest rate rise would leave many people worried about this would have on their personal finances.

For those aged between 21 and 42, this figure climbed to exactly half (50%) of individuals, but fell to 43% for those between the ages of 35 and 54, and fell further to just 23% of those aged between 57 and 75.

Aegon’s research revealed that one of the most immediate impacts of soaring interest rates is its effect on debt repayments. The study showed that across all age groups, over a quarter (27%) are concerned about the impact it will have on repayment on short-term loans, such as credit cards.

Another 35% indicated they are apprehensive about higher mortgage payments while half (51%) are worried the government will pass on the increase in tax raises.

“With inflation now at his highest since before the days that the internet was widely available and higher interest rates looking highly likely, many people will be feeling a financial squeeze like never before,” commented Aegon head of pensions, Kate Smith.

“Our research shows that people are worried about the pressure on their purse strings from all angles, with a high number concerned about tax rises impacting their take home pay while soaring interest rates will increase repayments on any debt, including a mortgage.

“It is unsurprising that the top financial priority for 2022 is paying for basic living expenses. It’s never been more important, regardless of situation, to make a realistic financial plan for both the short and long-term. Doing so can help with budgeting for immediate and future goals.”

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