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Debt problems among consumers reach an all-time high

Debt problems have hit an all-time high with more than 300,000 people in debt reaching out for advice, according to StepChange Debt Charity.


Marcel   LeGouais

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Marcel   LeGouais
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This is the highest figure of indebted people seeking advice the charity has ever recorded for a half-year, in this case between January and June of 2016.

 

StepChange said those affected are increasingly younger with more than 50 percent of its clients under the age of 40.

 

Those contacting the charity in the first half of this year had a combined total debt of £2.4bn, an average of nearly £14,000 per person.

The most common source of unmanageable debt, StepChange said, is credit cards, overdrafts and personal loans.

 

The charity said that employment does not necessarily provide a safeguard against debt; the charity has more clients in work now than it has since 2011.

 

StepChange also reported a dramatic increase of people in debt who rent their home; nearly a quarter of clients have rent in arrears at an average of £954 when seeking help.

 

Three in ten of those contacting the charity did not have enough money to pay their essential bills and credit commitments each month.

 

Mike O’Connor, chief executive of StepChange Debt Charity, said: “The government has said that it will review proposals that would see people seeking debt advice given ‘breathing space’ – time during which interest and charges would be frozen and enforcement action halted whilst people try to get back on their feet.

 

“The increasing numbers of people seeking our help shows that people who are struggling need help and the government must now take action which is long overdue.”

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