The Money Stats – September 2018 – Public Sector Improvements Mask Household Debt Concerns

Considerable improvements in UK public sector finances should be weighed alongside signs of concern for household finances, according to the September 2018 Money Statistics, produced by The Money Charity.

A dramatic improvement in the UK’s public sector finances has been seen over the year to July 2018, with the government running a current budget surplus of £7.8 billion and borrowing only for investment purposes. Some investment was, in fact, funded by the current budget surplus. Overall, Public Sector Net Debt (excluding RBS and debt to Bank of England) has reduced by £31 billion in the year to July 2018.

But the picture for households makes for a stark contrast, with households plunging deeper into debt, borrowing for both housing and consumption. Total net lending to individuals and housing associations increased by £46 billion in the year to July 2018, taking total net debt per household to £58,658.

Meanwhile consumer credit increased by £11.9 billion (5.9%) over the year, an increase of £227.94 per UK adult, while the average student debt in England, for the latest student cohort to begin repayments, reached £32,220. With high-interest rates on consumer debt, such as an average 18.35% for credit cards, UK borrowers paid an estimated £138 million per day in interest in July 2018.

With households taking on more debt, this suggests that they expect to be able to service and pay down their debt out of future income growth. However, real wages have barely increased in the year to July 2018 and are still below the level they reached before the 2008 crash, despite unemployment being at the low level of 4%.

Signs of financial stress can already be seen, with 301 people per day being declared insolvent or bankrupt in April to June 2018, and Citizens Advice Bureaux in England and Wales dealing with 2,397 new debt problems every day in August 2018.

Michelle Highman, Chief Executive of The Money Charity says:

“The current outlook is truly a mixed bag with so much uncertainty looming in the bigger picture. With tight household budgets and stagnant incomes, the need for financial capability has never been greater as households may be vulnerable to any downturn in the economy. People need to avoid compound interest traps, shop around for the best deals and avoid running up debts that may be difficult to service in the future.”


Other key points from the September Money Statistics:

  • Average first-time buyer deposits are equivalent to 94% of the average salary, nearly a whole year’s income, while private renters pay 34% of their income in rent on average.
  • It costs an average of £23.61 per day for a couple to raise a child from birth to 18, and £28.48 for a lone parent family.
  • In August 2018, cash machines were used an average of 94 times a second across the UK.

Get the full picture and many more fascinating facts about money in the UK in our monthly Money Statistics.


Notes to Editors

  • The Money Charity is the UK’s financial capability charity. We believe that being on top of your money means you are more in control of your life, your finances and your debts, reducing stress and hardship. And that being on top of your money increases your wellbeing, helps you achieve your goals and live a happier more positive life as a result. Our vision is for everyone to be on top of their money as a part of everyday life. So, we empower people across the UK to build the skills, knowledge, attitudes and behaviours, to make the most of their money throughout their lives. Find out more at
  • All statistics are from the latest available data at the time of writing/release.
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