Family Debts Levels ‘Up 42% Since Last Summer’
January 13, 2016
The average level of debt among families around the UK has increased sharply since the summer of 2015 and a large number of households could soon feel a financial squeeze as a result.
That’s according to the insurance firm Aviva, which reports that the overall debt level racked up by British families is now higher than it has been at any stage during the past two and a half years.
Aviva’s figures suggest that the typical family in the UK had £13,520 worth of debts, excluding mortgage debts, at the beginning of 2016 as compared with £9,520 six months earlier.
Two-parent families with children were cited in the data as being the demographic currently coping with the highest levels of debt outside of mortgage arrears.
Worryingly, Aviva’s investigations found that levels of both income and savings fell over the course of the second half of 2015 around the country as debt levels increased.
“The alarming levels of rising household debt, along with a recent reduction in income and savings levels, paints an uncertain picture for the family purse in 2016,” commented Louise Colley, managing director of Aviva’s protection operations.
“With the possibility that the Bank of England could raise interest rates this year, families who have grown accustomed to cheaper credit – particularly those who have spent heavily over the Christmas period – need to ensure they are still fully prepared to manage debt repayments, as well as other monthly outgoings, should rates go up,” she said.
Aviva’s figures on family incomes across the UK suggest that the second half of 2015 saw a 4.8 per cent fall on average in the amount of money coming into a typical British family’s household on a monthly basis.
This fall represents the first recorded decline in average family income since July 2012, with the past two and a half years having seen average monthly income levels rising.
According to Aviva, as many as one in five British families now say that they have no financial plans in place for the future, a figure that stood at 18 per cent a year ago.
If you live in Scotland and you are finding it increasingly difficult to cope with your debts then Scotland Debt Solutions could help. Call one of our experts today to find out how.
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