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Over half of UK adults head into 2020 with personal debt up to £100,000

21/01/2020

Almost 27 million (more than half) of the UK adult population will head into 2020 with debts hanging over their head, with almost 5 million owing over £10k in credit and loans, according to a poll conducted by money.co.uk

They polled over 2,000 people aged between 16-64 living in the UK, which found that, excluding mortgages, 63% will go into the new decade with some type of personal debt. This included money owed on credit cards, bank overdrafts and loans (personal and payday).

This means, that out of the 42.7million people within this age category in the UK, 26.9million people are possibly entering 2020 with debt as high as £100k.

The poll also highlighted that 33% of those polled have a personal debt anywhere between £2k-£10k, which works out as 9 million people across the UK. And nearly a fifth admitted their debt was over 10k – that’s 4.8 million people sitting burdened with this high level of debt.

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More than a quarter of respondents, from the North West, said they will go into the new year with a personal debt between £5,000 and £10,000, while 18% of respondents from Wales said 2020 will kick off with debts between £10,000 and £50,000.

Meanwhile, 45% of Scots won’t enter the New Year with any debt. This compares to just 30% of Londoners being debt-free at the start of 2020.

Salman Haqqi, personal finance expert at money.co.uk, stated: “It’s sobering to think that almost 27 million people will be heading into 2020 saddled with thousands of pounds of personal debt – a number that shows no sign of diminishing any time soon.

“It’s alarming to see that almost half of people never move their debt around to take advantage of better interest rates, something that could save them hundreds of pounds a year and help them pay off their debts sooner. 0% balance transfer cards are a good way to manage debt as they remove the added pressure of interest from your monthly payments.

Forms of personal debt

The most common form of debt revealed by the poll was credit card debt, with 38% of those polled admitting they had a balance payable.

Respondents average credit card debt was just short of £3k, with men owing over £300 more than women. On top of this it was revealed that 74% said they do not pay off their balance in full each month an 22% only make the minimum payment or less.

Causes of personal debt

When asked the reason behind their debt, 40% of those polled said it was due to normal living expenses, 19% put it down to holidays and 18% claimed spending on luxury items was the reason.

Haqqi continued: “One of the most concerning stats from the research is that 40% of people are using debt to pay for household essentials, simply unable to afford the cost of living from their regular income.

“Over four million people have between £10,000 and £50,000 of personal debt on average, which is a huge burden to bear, especially if circumstances change and they find themselves out of a job.”

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Getting debt help

The results from the poll have highlighted that many of us build up debt over time (46%), with one in six believing it will take seven years or more to pay off their debts.

But, there is help out there that can help you pay back your debts in a way that is affordable to you. The poll revealed that 13% of respondents are attempting to solve their problems by consolidating their debts into one place to make repayments more affordable.

Haqqi concluded: “It’s always worth going online and investigating what options are available to you, especially as the new year starts, as there may be cheaper alternatives and strong offer from lenders.”

Getting free advice about your money worries can kickstart your journey to a better money mindset, and you can take the first step today.

Our expert advisers are on hand to offer you free and confidential advice to work through your debts with you and find a way for you to deal with them in a way that works for you. Contact us today on 0808 2234 102 to start your journey.

 

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