Government figures are said to show that the consumer price index (CPI) has increased by this proportion due to mounting bills and higher taxes, affecting the amount of disposable income consumers have to repay debt.
Mark Till, marketing director at Barclays Insurance, commented: “We all seem to remember our money going a lot further in the past than it does these days and looking at these figures it’s not surprising.
“The biggest single increase has been in house prices but even everyday items have also got more expensive.”
His comments come as UK debt levels approach £1.3 trillion, highlighting the urgent need for people to take advice on becoming debt free.
Otherwise, as bills and taxes continue to rise, Britons may find themselves facing a debt crisis soon.