StepChange Debt Charity sees rise in people with arrears
A debt charity says it has seen a 44% rise in people in Wales with arrears on essential household costs like rent over the last year.
StepChange Debt Charity says it has also found more people turning to payday loans to cover their bills, up from 2.6% in 2010 to 18.3% in 2013.
In December, the GMB union said average earnings had dropped by 12.5% since 2008 in Wales.
The Welsh government has pledged £1.2m to help people with money education.
The report by StepChange Debt Charity says 7,559 people contacted its helpline with financial problems in 2013, a 44% increase on the previous year.
Its report Wales in the Red analyses difficulties encountered by 23,391 people in Wales between 2010 and 2013.
And it shows arrears have risen on rent, mortgages, energy bills and council tax which it blames on a "combination of low income growth and spiralling living costs".
The report said the average amount owed in payday loan debt to its clients has increased from £1,066 in 2010 to £1,335 in 2013, although the average total debt level has fallen from £18,964 in 2010 to £14,027 in 2013.
In 2010, the people it helped had £2.23 left each month after covering essential household bills, rising to £18.74 in 2012, but falling to £4.05 last year.
StepChange Debt Charity chief executive Mike O'Connor said: "Turning to high cost credit to pay everyday bills results in a downward spiral into further and further debt, with potentially catastrophic results.
"The sooner people take action the easier it will be to solve the problems they face."
In December, a GMB union study said the real value of average earnings of employees living in Wales after taking inflation into account dropped by 12.5% between April 2008 and November 2013.
Earlier this month, a survey by homeless charity Shelter said more than a third of people renting or with a mortgage in Britain expect to struggle to keep up with payments during 2014.
However, Citizen Advice Cymru says the number of debt advice "issues" it dealt with over the last quarter actually dropped by 5% compared with the same period the previous year.
Last week, the Welsh government said it was giving £1.2m to credit unions - championed as a way for people on low incomes to save and borrow money - to help with money management education and the development of financial services.