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Family debt reaches £1.5trillion

Collective personal debt in Britain has reached £1.5tr and consequently advice services have become swamped by anxious people overwhelmed by mounting debt, according to a report from spending watchdog the National Audit Office (NAO). Between July 2008 and July 2009, demand for debt advice rose 28%, with the average family struggling with debts worth 60% more than their annual income. Money owed on mortgages and credit cards amounts to an average £56,000 per household.

The figures were issued as debt experts warned that up to 150,000 people could face insolvency this year, a 15% increase on last year. The Consumer Credit Counselling Service says that its typical clients have 11 different creditors and debts of £24,300, excluding their mortgage.

The Government is committed to pumping £143m into providing extra debt advice between April 2004 and March 2011, mainly in free face-to-face counselling. The target was to help 261,000 people at a cost of £330 each and so far 270,000 have been advised at £311 each. NAO head, Amyas Morse, said the Department for Business, Innovation and Skills project had done well but demand was continuing to outstrip capacity and more measures were needed to reach even more people.

If you are struggling with debt call the Consumer Credit Counselling Service for free, confidential and independent advice on 0800 138 1111, or you can use their online debt counselling service Debt Remedy.

 

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