Britain - A day in debt (Mar 2007)

News Release

March 13th 2007

A report from the national money education charity, Credit Action

It is a well publicised fact that Britain today is a nation of borrowers and the UK is now responsible for a third of all the consumer debt held in Europe with total borrowing topping £1.3 trillion pounds in January. However most of the figures involved here are so mind boggling that we cannot really get our heads round them.

To simplify, Credit Action - who compile monthly debt statistics - have broken the figures down to a manageable level so that we can see what is happening on a daily basis; 24 hours in buy now, pay later Britain.

Consumer borrowing
In the UK consumers borrow £360 million every day.

Of this amount, £324 million will be secured borrowing such as mortgages and £36 million will be unsecured, borrowed mainly on credit cards, store cards, loans, overdrafts.

If the amount borrowed was spread evenly across every man, woman and child in the UK that by the end of today we will all owe £5.94 more than we did at the start.

Consumer's struggling

• In the next 24 hours 300 people will be declared insolvent.
• 5,300 people will seek advice on debt problems.

Property & debt

• In the next 24 hours the average house price will rise by £40.
• 289 possessions actions are initiated on a daily basis.

Spending on plastic

• Every day 24.3 million plastic transactions take place.
• 7.4 million withdrawals made from the UK's 58,000 cash machines.
• £471.3 million will be taken out of cash machines today.

Increasing cost of living

• To run a car in the UK now costs £15 a day.
• Raising a child to the age of 21 in Britain will now set you back £23.50 daily¹

Slowing down?

The Council of Mortgage lenders estimates that by the end of 2007 £1bn a day could be being lent in mortgages. Chris Tapp, the Associate Director of Credit Action comments, "Day by day in the UK we now borrow and spend at an astonishing rate, it issuch a key part of our everyday life. However there are real risks associated with this patternas the numbers of people falling into difficulty on a daily basis shows.

We need to make sure that we are thinking very carefully to ensure that the money we are borowing for today, we can afford to pay back tomorrow."

Credit Action is also worried about the lack of savings being built up at a time when so much is being spent. Half of all of us in Britain have less than 2 months salary tucked away and 1 in 3 admit that they saved nothing at all during 2006². Chris Tapp has this advice, "Having savings is vital to ensure that should there be a change inpersonal circumstances or the wider economic situation tomorrow, there is a financial safety net.

Today would be a great day to do something about securing your financial future!"

 

-ends-

 

Sources:

¹ Cost of raising children figure from Liverpool Victoria

² Figure from Alliance & Leicester

 

For more information contact Chris Tapp on 0207 636 5214 or at c.tapp@creditaction.org.uk.

Notes for editors: Credit Action is the national money education charity (registered Charity No. 1106941) established in 1994. It aims to teach people to manage money better and prevent over-indebtedness and uses a wide range of resources to this end. Credit Action also campaigns to encourage greater understanding of the need for more financial education and literacy. For those with debt problems, Credit Action offers a helpline through Consumer Credit Counselling Service, the UK's leading debt charity.