Debt-laden Brits are borrowing a third more than they earn, shocking new figures reveal.
The average person owes a whopping £26,800 a year – but only has a disposable income of £20,200, the Office for National Statistics (ONS) said. This means they owe a staggering £6,600 a year more than they take home after tax.
Getty – Contributor Brits are accumulating more debt than they earn in a year
Campaigners said hard-pressed families are racking up massive debts just to meet basic costs like their supermarket bills. Debt has been steadily ballooning since 2013, and unsecured borrowing now hit an all-time high.
Glenn Everett from the ONS said while employment numbers are higher than ever, people are gloomy about their economic prospects. He said: “This may be due to worries about rising debt repayments, which could be driving concerns about their future financial situation.”
Shadow Chancellor John McDonnell said the figures should be a “wake up call” to ministers.
He said: “The unequal nature of the economy under the Tories is highlighted by income growing significantly faster for the top 20 per cent than the bottom 20 per cent. Underemployment remains well above its pre-crisis level, while millions of others are overworked.”
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Peter Tutton, from the debt charity StepChange, said the figures lay bare the cost of living crisis hitting families. He said: “Too many households simply don’t have enough money to pay their day-to-day bills, with over one million having to use high cost credit to make ends meet.
“The majority of people we see are having to cope with a big life event like job loss, ill health, or relationship breakdown. People need better options than taking on more debt, which can make these difficult problems even harder to recover from.”
A Treasury Spokesman said they know “debt can be a struggle” for some people. He said ministers are increasing funding for debt advice services.
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