Millions Taking on Debt to Cover Essential Outgoings

May 30, 2018

As many as 9.3 million Brits resorted to some form of credit to cover essential expenses at some point over the course of last year.

That’s according to figures gathered by the debt help charity StepChange, which has estimated that roughly three million UK consumers found themselves behind on essential payments during 2017.

The charity estimates that of the 9.3 million people who used credit to cover essential expenses last year, around 1.4 million used high cost credit for that purpose.

Being in arrears on high priority bills, such as rent or mortgage payments, council taxes or energy bills, is generally taken to be a worrying sign as far as overall financial wellbeing is concerned.

Among the people who reached out to StepChange for advice and support last year, essential bills and food costs accounted for an average of 60 per cent of their typical monthly income.

However, for those people with the lowest incomes, basic expenses typically accounted for more than 90 per cent of their ordinary monthly income.

According to StepChange’s latest figures, working on the basis of zero hours contracts can have a very considerable influence on how often individuals and households find themselves unable to cover the costs of their most essential bills.

In fact, the charity’s data suggests that people with “highly variable incomes” were generally twice as likely as those with more stable incomes to go into arrears on priority expenditures over the course of 2017.

StepChange has said it wants to see action taken by the government to “ensure the right kind of debt support framework is in place” to help people who struggle to cover their core costs on a monthly basis.

Peter Tutton, the debt help charity’s head of policy, has said that key creditors, including landlords, local authorities and utilities companies, should be doing more to help people whose incomes fluctuate or are unavoidably variable.

If you live anywhere in Scotland and you are finding it tough to cope with your debt problems then Scotland Debt Solutions can help. Contact us directly to arrange a FREE and confidential consultation.

John Baird

Insolvency Adviser

Tel: 0800 063 9250

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