Big Increase In Household Debt
According to a new report from the Office of National Statistics (ONS), household debt (excluding mortgages) is on the rise across the UK.
The average household debt rose by 9% to £9,400 – credit cards and personal loans rose by 11% to £119bn! However, the results are slightly skewed by student loans:
“The figures are skewed slightly by the £32bn of student debts – which the vast majority of graduates will never pay back in full,” said Sarah Coles, personal finance analyst at stockbroker Hargreaves Lansdown.
“However, even excluding that we’re carrying £87bn in loans, credit cards, hire purchase agreements, overdrafts and arrears.”
In a shocking result, it appears that the poorest 10% of households have debts three times greater than the assets that they own.
“Not all these debts are the same: there’s a world of difference between taking an affordable, low-cost loan for vital home improvements, and living on your overdraft month after month, because it’s proving so difficult to make your salary stretch to the end of the month,” said Ms Coles.
“But if you’re one of the 44% of people who see their borrowing as a burden, it’s worth taking steps to deal with your debts.”
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