More than half of households are struggling to repay credit cards and loans, a Bank of England survey suggested.
A total of 51 per cent of respondents reported that their unsecured debts were a "burden" – a record high for the annual study.
Illustrating the financial pressures faced by millions, one in two households also said they had seen their disposable income fall over the past year.
More than a quarter – or 28 per cent – said their monthly earnings had fallen by more than 100 during that time, with just 14 per cent saying it had gone up.
The report said: "The UK economy has begun to recover over the past year but households' financial positions remain under strain."
Around half of respondents expressed concern about their level of debt, with a majority saying they had become more worried over the last two years.
More people – 22 per cent of households, a figure up 5 per cent during the year – said they were worried about access to credit despite promises by banks and governments to provide more finance.
Many families are also fretting about looming tax rises such as next month's 2.5 per cent VAT hike, to 20 per cent, putting even more pressure on budgets.
Some 42 per cent also said they were concerned about the VAT rise, and nearly a third – 32 per cent – said they were worried about rising income tax and national insurance.
Just over a quarter – 27 per cent – said reduced Government spending on services was a major fear.
The report contrasted the low Bank of England interest rate of 0.5 per cent with the "high" cost of borrowing.
It said the burden of unsecured debt had risen this year, reflecting a combination of weak earnings growth and the interest rates on unsecured debt remaining high despite falls in bank rate.