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New Years Resolution for UK Debt

January 2011

Happy New Year!

With the start of the New Year, we know people are working on setting new goals and planning the year out.

For some, it may be the year we want to try something new: Fly a plane, go on a holiday of a lifetime, or maybe we just finally want to get in shape. But for many, I know one on the list is to get out of debt.

Statistically, the average person in the UK has 2.7 credit cards, 3.8 store cards and 1.1 debit cards, for a total of 7.6 cards per cardholder. About 18% of all daily personal consumption expenditures in the country are made on credit cards. Add in store cards and debit cards and the figure rises to 24%. The average university graduate has nearly £20,000 of debt. Average owed by every UK adult is 126% of average earnings.

Individuals owe more than what the whole country produces in a year.

Check out the figures below and see the real costs of life in the UK.

This year, as you set your goals, we encourage you to take a good look at your financial situation, write down and plan out specific goals in order to maximize your effectiveness.

It’s not always easy, and maybe we need some help, some direction and ideas.

UK Personal Debt: The Facts

Personal debt in the UK at the end 2010 stood at over £1,450bn.

A twelve-month growth rate of 0.8%.

Individuals owe more than what the whole country produces in a year.

Total secured lending on residential property stood at £1,240bn. The twelve-month growth rate decreased 0.1% to 0.8% as a result of a poor housing market and the changes of lending criteria by the banks and building societies.

Total consumer credit lending to individuals at the end was £270bn. The annual growth rate of consumer credit was unchanged at 0.6%.

UK banks and building societies wrote off over £10.1bn of loans to individuals in the last 12 months. This amounts to a write-off of £20.10m a day.

Average owed by every UK adult is 126% of average earnings.

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The average household debt in the UK is £8,495 (excluding mortgages). This figure increases to £16,336 if the average is based on the number of households who actually have some form of unsecured loan.

The average household debt in the UK is £57,706 (including mortgages).
If you add to this the March 2010 budget report figure expected in 2015-16 then this figure rises to £109,928 per household.

Average outstanding mortgage for the 11.4m households who currently have mortgages now stands at £108,936.

Britain’s interest repayments on personal debt were £65.1bn in the last 12 months. The average interest paid by each household on their debt is approximately £2,582 each year.

Average consumer borrowing via credit cards, motor and retail finance deals, overdrafts and unsecured personal loans had risen to £4,399 per UK adult by the end 2010.

The Office for Budget Responsibility (OBR) predicts that household debt will be £1,823bn by end 2015 which is a growth of £159m a day. This would take the average household debt to £72,341 per household. 

Today in the UK

372 people every day of the year will be declared insolvent or bankrupt. This is equivalent to 1 person every 53 seconds during a working day.
1,716 Consumer County Court Judgements (CCJs) were issued every day during 2010 and the average judgement amount was £3,312, This is predicted to increase in 2011
9,389 – new debt problems the Citizen Advice Bureaux dealt with every working day in England and Wales in 2010, this is predicted to increase in 2011
1,000 people are seeking some form of formal debt rescheduling every working day.
98 properties were repossessed every day during2010
449 people a day became unemployed for more than12 monthsduring the 12 months to end October 2010
1,732 people reported they had become redundant every day during 3 months to end October 2010
£349,000,000 is the amount that the Government Public Sector net debt (PSDN) will grow today! (equivalent to £4,040 per second!).
£127,400,000 is the interest the Government has to pay each day on the UKs net debt of £971 bn. This is estimated to rise to £182m a day in 2015-16.
207 mortgage possession claims will be issued and 154 mortgage possession orders will be made today!
372 landlord possession claims will be issued and 248 landlord possession orders will be made today!
7.9m cash withdrawals will be made today with a total value of £530m!
9,389 – number of new debt problems dealt with by CAB each working day
1,732 people – made redundant daily
839,000 – unemployed for > 12 month
£57,706 – average household debt
£178m – personal interest paid in UK daily
£20.10m – daily write-offs of loans by banks & building societies
every 15 minutes – a property is repossessed
every 3.87 minutes – someone will be declared insolvent or bankrupt
£1,153,000,000 – total value of all purchases made using plastic cards today
£16.08 - The average car will cost to run today
£26.00 -The average cost per day of raising a child from birth to the age of 21.
£2.73 – The average person will save just per day.

 

And not only that, but the UK population is projected to grow by 1,178 people a day over the next decade.