UK consumer debt reaches £56,000 per household

Figures from the National Audit Office revealed that personal debt in the UK has reached a massive £1.5 trillion as the downturn continues to impact upon consumer finances. This figure of £1.5 trillion includes credit cards, mortgages and personal loans and equates to a debt for each UK household of £56,000, 60% higher than the average household income and the highest figure ever.

Many debt advice agencies are under pressure with new customers calling each and every day and an average 30% increase in enquiries. Indeed many debt advice agencies have refused to take on new customers, such is their backlog, with some people waiting up to 6 weeks for an appointment. This is a situation which has been brewing for some time and many believe we will see bankruptcies, IVAs and trust deeds increase in number for the next 12 to 18 months. While many people feel that 2009 was a difficult year for personal finances, it is forecast that an additional 150,000 people will experience insolvency in 2010!

The ever-growing debt mountain in the UK is becoming more and more of a problem and will hold back any economic recovery with consumer expenditure under pressure for some time to come. However, when you consider that national debt is well over £1 trillion and personal debt has been quoted at £1.5 trillion there is a monumental debt mountain to climb.