Two research reports released in the past week show that the proportion of households that are financially stressed is surprisingly high and increasing.Digital Financial Analytics and Monash University Centre for Commercial Law and Regulatory studies were commissioned to research the subject by the Consumer Action Law Centre, Good Shepherd Microfinance and Financial Rights Legal Centre. They found that 31.8 per cent of Australian households were financially stressed and a subset of 21.3 per cent was financially distressed.DFA and Monash reported that the proportion of financially stressed households had increased from 26.3 per cent in 2010 and the proportion of financially distressed households had increased from 16.6 per cent over the same period.In a separate study, Wesley Mission surveyed 500 households in New South Wales and found that 44 per cent were financially stressed. That number has grown from 37 per cent in 2010.The studies use different definitions of financial stress, which accounts for the different levels detected.Indicators of financial stress used by DFA and Monash include: mortgage default or late mortgage payments; falling behind with other loan repayments; having an application for credit declined; consistently borrowing to repay an existing loans (this does not include mortgage refinance); seeking debt counselling or credit repair; difficulty getting or keeping a bank account; and being in bankruptcy or debt agreement.Indicators of financial distress include: repeat borrowing; limited credit options; insufficient regular cash flow to meet obligations as they fall due; unable to find A$2000 in an emergency; and limited access to banking facilities.Wesley Mission's indicators of financial stress include: inability to pay one or more of an electricity, gas, phone, home heating bill, car registration and insurance, household repairs, replacement of an appliance, medical or dental fees; going without meals; seeking financial assistance from family, friends or community organisations.DFA and Monash said one-parent families with a female parent were more likely to be in financial stress than those with a male parent. The reason for this was a lack of child support income.DFA and Monash said causes of financial stress included overspending, poor budget management, loss of employment, health problems, reduced government benefits and relationship breakdown. Wesley Mission found that 38 per cent of households spent more than they earned and 19 per cent rarely or never maintained a household budget.Neither survey offered reasons for the increase in financial stress over the past five years. However, DFA and Monash both pointed to loss of employment and reduced government benefits as increasingly important causes.Wesley Mission said the impact of financial stress was a reduction in "social and family engagement", such as taking a holiday, spending time on leisure activities that cost money, buying new clothes and having a night out. Respondents said they were more likely to suffer illness when they were financially stressed.