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Personal insolvency advice could be needed by many people across the UK, as the Economic Background Index from Alliance Trust Savings indicates continued “extremely challenging” conditions for households.

The Index sets a critical benchmark figure of 100 for households’ economic health level, and any result lower than three figures is cause for concern.

For the past six consecutive quarters, however, a double-digit result has been recorded, and in Q4 2012 the EBI dropped further, from 74.5 to 72.9.

“The fall was driven by a deterioration in the rate of debt insolvencies and the fact that economic growth remains absent,” Alliance Trust Savings reports.

EBI is now the weakest of the three indicators – which include an assessment of household budgets and one of net wealth – that feed into the overall Financial Reality Index compiled by the investment management specialist.

That headline figure has also suffered from the poor economic conditions, dropping to 84.4 – its lowest since Q2 2012 – and further highlights the need for anyone suffering from household budget difficulties or debt arrears to seek personal insolvency advice as soon as possible, in order to freeze interest and clear debts wherever possible.