The number of individuals applying for insolvency jumped to the highest level in almost three years in the first three months of 2017, in a further sign of the mounting financial pressure facing UK households.

Personal insolvencies in England and Wales totalled 24,531 between January and March, up 6.7% on the previous quarter and 15.7% higher than the same period a year earlier. It was the highest number of individual cases since the second quarter of 2014, according to the Insolvency Service, which published the figures.

The rise comes at a challenging time for UK households, as incomes are squeezed by a combination of rising inflation and weak pay growth. The annual inflation rate is 2.3% and expected to rise to 3% in the coming months, as the impact of the weaker pound since the Brexit vote increasingly feeds through to higher shop prices. Meanwhile regular pay growth was just 1.9% in February compared with a year earlier.

Joanna Elson, the chief executive of the Money Advice Trust, the charity that runs National Debtline, said the insolvency figures were concerning.

“Growing levels of household debt and extra pressure on budgets from inflation are a worry, and we expect this to translate into greater demand for free debt advice over the rest of 2017,” she said.

“We would urge anyone who is already struggling with their finances, or is concerned that they are only one bill away from falling behind, to seek free advice as early as possible.”

At 59%, individual voluntary arrangements accounted for the majority of personal insolvencies in the first quarter, while debt relief orders made up a further 25% and bankruptcies accounted for 16%.

IVAs are arrangements where money owed is shared out between creditors, while DROs are available to people with less than £20,000 of debt who do not own their own home.

Adrian Hyde, the president of insolvency and restructuring trade body R3, said: “Although borrowing rates remain at record lows, rising inflation and slowing real wage growth will be limiting people’s financial room for manoeuvre.

“Compared with where insolvency numbers were a few years ago, personal insolvency rates are still low and the recent bankruptcy rises have been very small. However, a continued gradual upwards shift may be a sign that the post-recession return of high levels of consumer borrowing and spending is starting to reach its limits.”

He cautioned that the statutory numbers did not give the full picture of personal insolvency in England and Wales, with potentially hundreds of thousands of people on debt management plans who are not covered in the official statistics.

The Insolvency service also reported that the underlying number of corporate insolvencies rose by 4.5% in the first three months of the year, compared with the previous quarter, and 5.3% compared with the same period a year earlier.