Citizens Advice says it is seeing a growing number of people in work, who previously had just enough to get by, being pulled into the red.
While people have generally seen their wages increase, essentials have risen at a faster pace, the charity said.
It added that people who are self-employed have been particularly hit by “negative budgets” – meaning they have more money going out on essentials than coming in.
So far this year, 58% of self-employed people the charity has helped with debt have been in a negative budget. This compares with 39% in 2019.
Matthew Upton, director of policy at Citizens Advice, wrote in a report: “Most people expect that if you work hard, you should have enough money to get by.
“Yet, our frontline advisers are seeing more and more people in work who can’t make ends meet. This is even after they’ve had specialist advice and done what they can to cut costs and maximise their income.”
For people in full-time work, the proportion of people in a negative budget has increased from around 27% in early 2019 to nearly 39% by this year, he said.
Mr Upton added: “We’re seeing a growing number of people in full-time work, who previously had just enough to get by, being pulled into the red.”
Nearly half (46%) of people in part-time work that the charity is seeing are in a negative budget, up from 36% in 2019.
People the charity sees who work part-time are more likely to need benefits to top up their income, Citizens Advice added.