Young people see level of debt double
30/01/2015
Young people aged 18-34 have seen the level of their debt double within a year, research from the price comparison website, MoneySuperMarket, has found.
Consumers of all ages now owe a total of £196 billion collectively in debt. This is an increase of 41% from last year, and the average amount people owe on unsecured credit has risen to £5,898 each. People aged 18-34 have seen their unsecured debts rise from an average of £5,446 to £10,058 now.
Consumer borrowing continues to rise, and 47% of those in debt now owe more than they did last year. Only 36% of borrowers think they will pay off their debts within a month, with a further 24% expecting it to be cleared within a year. However, 14% of borrowers think they will be saddled with the debt for two to five years.
Half of people in the UK owe money on a credit card, 23% regularly go into debt due to their overdraft and 12% have a personal loan.
Dan Plant, consumer expert at MoneySuperMarket said:
“This research begs the question whether the economic recovery being celebrated by politicians is simply based on a rapidly climbing debt time-bomb.
“Not only are personal debts up by 40% across the board - with under 35s worryingly seeing what they owe more than double in just a year – they are being paid off more slowly than a year ago. This suggests the British public may be robbing Peter to pay Paul, with the increased consumer spending we’ve witnessed just a by-product of this – which would be hard to sustain. It was borrowing at excessive levels that was one of the contributing factors to the economic crisis so we must hope we aren’t witnessing a repeat of mistakes of the past.”
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