The Resolution Foundation said almost half of low-income families were in debt distress before the Bank of England said last week that it needed to increase the base rate at an accelerated pace over the next two years.
A study by the foundation showed the proportion of households in some form of debt distress rose to 45% among the poorest fifth of working age households, with more than a third experiencing difficulty in paying for accommodation and one in six in arrears on either their mortgage or consumer debts.
Households headed by someone aged 25-34 spent nearly £1 in every £5 of their pre-tax income on debt repayments in 2017, compared with 20p for households aged 65 and over.
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