Loan Debt Worry Threshold Rising
Personal debt through unsecured loans and credit cards seems to have become the norm in the UK these days, with most individuals simply accepting their debt levels. But the threshold of debt levels at which people start to worry about their debts is increasing, according to research from moneysupermarket.com.
According to the latest survey from the price comparison site, the average level of personal loan and credit card debt in the UK currently stands at £8,431 per person, excluding any debts outstanding on home owner loans or mortgages.
However, the survey also found that the average person does not start to worry about their personal loan debts until they reach £9,767. Furthermore, many people do not actually seek professional advice regarding their debts until they owe an average of £19,478.
The survey also discovered that men typically seem to have a 24 per cent higher level of debt than women, with the average male loan and card debt standing at 9,403, compared with an average loan debt of just £7,593 for women.
Around ten per cent of all individuals with this level of loan and card debt are only paying the absolute minimum repayment amount each month, meaning that their debts will be with them for much longer and cost more in interest over the term.
Despite this, almost half of those interviewed said that they would not be prepared to pay a fee for professional debt advice in order to help them sort out their personal loans and other debts.
Tim Moss of moneysupermarket.com said “it is worrying to see that while people become concerned about their debt at £9,767, it takes a further £10,000 to trigger a need to seek debt advice.”
“For most people, paid advice is a last resort and consumers should explore do-it-yourself solutions and fee free debt advice from some of the many debt charities, such as the Consumer credit Counselling Service or Citizen’s Advice Bureau.”
