Increases in costs of living are adding to the financial pressure faced by people in debt – with average living costs increasing by £642.12 in the last 12 months, according to research by Confused.com.

On average, each British household spends £18,502.86 a year on essential costs, including bills – up from £17,860.74 last year.

The main contributors to this rise are car insurance, mortgage/rent and mobile phone bills, according to Confused.com’s figures.

“The rise in costs of living experienced by households over the last year will vary, but people who are already struggling with their finances will be hit the hardest,” said a spokesperson for the IVA Forum.

“With that in mind, we advise all households to do what they can to reduce their costs of living and minimise the impact of rises in essential costs, such as energy bills and groceries.”