Millions of Britons are preparing to tighten their belt and cut back on expenditure, foregoing luxury items in an effort to save money, it has been suggested.

According to Alliance & Leicester, nearly 35 million Britons have made some form of financial cutback to meet the demands of various living costs such as food expenditure, energy bills or debt reduction.

More than a third (34 per cent) of respondents said that they expect their disposable income to be reduced in the coming six months, with 79 per cent attributing this expected drop to the rising costs of food, energy and consumer goods.

Clothes shopping was said to be the habit most people were looking to cut back on, while some 36 per cent of people said that they expected to socialise less in the coming months.

Emma Walkley, current account manager at Alliance & Leicester, said: "many of us are feeling the pinch and looking for ways to cut back. The good news is that people are taking action now and looking at ways of making their money go further."

In March, Alliance & Leicester noted that debt reduction and other financial matters were becoming a prominent topic of conversation among friends, families and colleagues.

Credit reference service Call Credit has suggested that many UK consumers’ savings would not last them more than one month if they became solely reliant on them.

For 40 per cent of the working population, savings would run dry within this time period if their income was cut off.

A further 25 per cent of people have reduced their levels of saving in recent months in order to meet the costs of inflated monthly outgoings.

One in ten people were said to have dipped into savings to meet the costs of living expenses as the credit crunch and energy price hikes hit home.

"These findings are a stark illustration of how the credit crunch is already affecting consumers, it’s clear that the rising cost of everyday living is having an immediate impact on our ability to save," said Owen Roberts, head of Callcredit Check.

For those struggling with debt, the group advised consumers to seek independent financial advice to help plan the best course of action.

Elsewhere, the Thrifty Scot has recently identified individual voluntary arrangements (IVAs) as an effective tool for those who cannot meet the costs of outgoings and debt repayment commitments.

The average rate of an unsecured personal loan has increased by one per cent in the last six months, despite the Bank of England cutting the base rate three times, according to figures released by MoneyExpert.

This is specifically on loans between £5,000 and £7,500 as experts still believe individuals can get more competitive rates if borrowing a larger amount.

Sean Gardner, founder of MoneyExpert, said: "You will pay lower rates on average if you borrow more. Lenders take the view that those borrowing more are generally a better risk than those borrowing less and offer better deals as a consequence."

Such news may be of interest for those looking to get a loan in an attempt to consolidate debts.

Figures recently released by MoneyExpert show that 3.24 million British consumers were turned down for a credit card deal in the last six months.

This rise in the amount of people not being approved for credit follows lenders tightening their criteria as to who they wish to lend to in what they see as a market growing in risk.

Payday loans have seen a "massive upswing" in popularity among UK consumers in recent months, new figures have suggested.

According to data compiled by Moneysupermarket.com, the number of payday loans being taken on around the country was 55.4 per cent higher in April than in September of last year.

The price comparison service has put the rise in popularity of short-term high-interest loans down to the fact that more and more people are finding it very difficult to pay their way towards the end of each month.

Money problems are growing in severity for households across Britain and payday loans are being viewed by many as preferable to using an overdraft without prior permission.

Tim Moss, head of loans at Moneysupermarket.com, said: "They should only be taken out when it’s absolutely necessary and you are sure you can pay it back quickly."

Meanwhile, Credit Action recently revealed its aim of seeing certain loan advertisements banned from appearing on the social networking website Facebook, partly because of their lack of interest rate information.

British consumers have been urged not to rely on debt to fund their everyday living expenses.

According to Chris Tapp from Credit Action, it is vital that consumers avoid falling into a habit of paying for food and household bills with credit cards because this kind of approach can easily lead to serious debt management problems.

"People have to be very careful they don’t find themselves overly reliant on credit which is unsustainable in the long run," he said.

Mr Tapp’s comments came in response to figures from Capital Economics that suggest the proportion of household incomes in the UK being spent on food and fuel has increased notably in recent months.

He added that reliance on debt could lead to money problems because British lenders are becoming increasingly reluctant to offer credit deals.

According to Credit Action, the average amount paid out in interest to avoid debt problems each year by a British family is currently close to £3,765.

A charity group from the UK has warned that the advertisements for loans featured on the social networking site Facebook could fall foul of relevant regulations.

Credit Action is concerned that the promotions are being aimed at young people who use the popular website regularly and has written to the Office of Fair Trading to make clear its complaints.

Part of the problem is that annual percentage rates are not featured on the advertisements and could lure young people into taking on loans that eventually lead to serious debt problems, the charity has explained.

"Research by Credit Action has shown that much of this advertising breaks the rules on advertising credit and so we are campaigning to encourage Facebook users to report ads which break the rules," said a spokesperson for the group.

Last week, David Kuo, head of personal finance at Fool.co.uk, suggested that British consumers facing money problems should avoid placing credit applications that are likely to be rejected.

Young British consumers across the country are in real danger of entering a devastating cycle of personal debt problems, it has been claimed.

According to a new report from the charity group Rainer, a third of the 18 to 24-year-olds it surveyed had less than £5 per week after their most pressing debts had been paid off.

"One unexpected expense can see their debts spiralling out of control and this has a devastating impact on their lives," said chief executive of Rainer Joyce Moseley.

The research by the charity also discovered that close to half of the young people they polled had a personal debt burden worth in excess of £2,000 and a fifth were more than £10,000 in the red.

Rainer’s report follows a study by the mental health charity Mind that suggested debt problems are causing serious psychological strain for millions of Britons.

Securing a borrowing arrangement will not be an easy task for British consumers in months to come, it has been claimed.

According to David Kuo, head of personal finance at Fool.co.uk, would-be credit users are fighting one another for resources that are becoming increasingly scarce.

Millions of Britons are dealing with debt management and money problems and without a strong borrowing record they could be facing a serious struggle to resolve their financial issues, Mr Kuo maintains.

"We urge borrowers to be aware that when they remortgage or apply for new loans, they are competing for a scarce resource," he said.

"They will be judged on merit and no one should take approval for granted."

Mr Kuo’s comments came in the wake of the prediction from the Bank of England that average house prices in the UK will fall by a third in the next few years.

Including mortgage arrears, the typical British household has a debt management burden worth just over £57,000, according to data from Credit Action.

Adults across the UK are lending money to their parents who have found themselves struggling financially in recent months, it has been revealed.

Parents have been handing over sizable sums to their children to pay off their debts in recent years and now almost £11 billion is now thought to be heading back in the other direction.

According to Scottish Widows, a third of all the money given or lent to British consumers by their children is designated for solving debt problems.

However, parents are still thought to be lending their sons and daughters considerably more than they receive and this is believed to be partly why so many are facing money problems of their own.

"It’s obvious that parents have felt the pinch as a result of being ‘sapped’ for thousands of pounds from their adult children and are now turning the tables on them and ‘sapping back’," said Anne Young, savings expert at Scottish Widows.

According to Moneysupermarket.com reports, as many as 6.8 million British consumers are now thought to be experiencing debt problems related to their energy supplies.

Families facing debt problems are being pushed to breaking point and beyond, according to a new report.

A study carried out by the debt counselling group Christians Against Poverty (Cap) found that more than two-thirds of people who contact the organisation have missed meals in order to meet their repayment demands.

In fact, close to a quarter confessed that they regularly go hungry in an effort to save money and clear outstanding arrears, the Cap reports.

Furthermore, half of those polled said their debt problems had caused stress and arguments with loved ones and in a quarter of cases these issues were blamed for relationship breakdowns.

"Our latest findings are truly shocking, highlighting the trauma that many families in debt face on a day-to-day basis," said Matt Barlow, head of the Cap in the UK.

Research by Prudential recently suggested that money and debt management problems have forced thousands of British families to house three generations under the same roof.