Today the UK’s leading financial capability charity The Money Charity releases The Money Statistics, giving an overview of the financial situation in the UK.
Our statistics reveal that individuals are taking on unsecured debt at a faster pace than any time in the last decade. If the current rate of growth keeps up for the whole of 2016, each adult will owe an average of £271 more on their credit cards, personal loans and others forms of consumer debt.
On average, every adult in the UK has £3,629 of this kind of debt, up from £3,171 at the end of 2013. Although this is still below the high point of consumer credit in 2008, the sustained growth may place many consumers in precarious financial positions.
Just over a third of this debt, £64.4 billion, is on credit cards. Credit can often be a useful tool in managing your finances, but paying back money you’ve borrowed can also be a huge challenge.
Per household we owe £2,387 on cards – for a credit card bearing the average interest; it would take 25 years and 6 months to repay if you made only the minimum repayment each month.
*At current rate, Source: Office for National Statistics and Bank of England
Michelle Highman, CEO of The Money Charity said:
“Credit can play a really useful role in people’s lives – spreading the cost of purchases and smoothing unsteady incomes. And debt is not always a negative sign. As a country, we tend to borrow more when we’re doing better.”
“But debt can also creep up as a problem, both for society and for individuals”.
“If things are already too much, pick up the phone to StepChange or one of the other free debt advice charities who will be able to help you properly assess your options.”
Other key points from May’s Money Statistics include:
- The median rent in England across all property types for the 12 months to March 2016 was £650, data from the Valuation Office Agency shows. In London this was £1,452.
- The average monthly rent for a two-bedroom house in England was £600 – in London this was £1,500 (150% higher).
- Public Sector Net Borrowing (excluding public sector banks) was £7.2bn in April 2016, meaning that the Government spent an average of £250m per day more than it spent during the month (equivalent to £2,894 per second).
Get the full picture, and many more fascinating facts about money in the UK in our monthly Money Statistics.