One in 10 adults in the UK spends more than they earn every month, according to figures released by Uswitch.

The utility comparison site estimates that 5m people are living beyond their means while a further 10m have no spare money left over at the end of the month.

The research found that those spending more than they earn relied on overdrafts and credit cards to make ends meet.

The findings will add to the feeling that consumers will be forced to reign in spending habits and raises the possibility of widespread bankruptcies if stock market falls translate into job losses.

A widespread fall in consumer spending would be bad news for thousands of small businesses which rely on retail sales.

A move by the Bank of England to cut interest rates would go some way to relieving pressure on homeowners but the Bank remains concerned over the rate of inflation.