Survey reveals 6m Britons fear never being debt-free with 25% struggling to make ends meet and 62% worried about personal debt levels
More than 6 million Britons don’t believe they will ever be debt free, according to new research which has also found the average person in the UK owes £8,000 – on top of any mortgage debt.
Almost a quarter of all Britons said they are struggling to make ends meet, while 62% said they were often worried about their levels of personal debt, according to research for Comparethemarket.com.
Earlier this month, the price comparison website asked 2,000 adults detailed questions about their personal finances. They found that 10% of respondents had “maxed out” on a credit card, while a similar number said they had been overdrawn within the past 12 months.
A third of those interviewed told researchers that they were already planning on taking on additional debt – in the form of credit cards, loans car finance and mortgages – in the next year.
Over a third said they could not see themselves ever being in a financial position to help younger family members, breaking the tradition of the “bank of mum and dad”.
The results chime with a recent study by the Financial Conduct Authority which found that that 4.1 million people are already in serious financial difficulty. The survey, the biggest ever by the city regulator, concluded that half of the UK population are financially vulnerable, with 25- to 34-year-olds the most over-indebted.
Shakila Hashmi, head of money at Comparethemarket.com, said: “Right now millions of Brits could be in danger of suffering from one of the longest financial hangovers in history. While it may be hard to see an end in sight, the worst thing people in debt can do right now is stick their head in the sand. As well as reining in spending, there are other ways you can reduce debt, like switching to credit cards that help you get on top of debt with interest-free periods.”
Hashmi said for those with credit card woes out of control, charities such as StepChange offer free and impartial advice to help get debt under control.
Comparethemarket.com has created a new “debt free face” calculator, in which users input their personal finances and can upload a photo of themselves to learn how old they will be when they are debt-free (and what they will probably look like when that time comes).
Last week the ratings agency Standard & Poor’s warned that the rapid rise in UK consumer debt to £200bn is unsustainable and should raise “red flags” for the major lenders.