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The average individual debtor in the UK would have to devote nearly three months’ wages to servicing their debts in order to clear them completely, according to figures from R3.
In their latest report, the Association of Business Recovery Professionals list the average individual debt in the UK at £5,534, excluding mortgages and student loans.
For comparison, R3 cite average weekly earnings of £481 for a typical UK employee, and rent of £770 per month.
Combining these figures together, it would take 12 weeks for the typical debt to be cleared, if nothing was spent on anything else – and seven months’ worth of rent payments.
Giles Frampton, president of R3, said: “Some levels of debt are extreme, but even those with relatively low value debts need to tread carefully.
“You only need to be unable to pay £750 to one creditor and it’s within their right to petition to have you made bankrupt.”
Interestingly, young people – those aged 18-24 – owe the least on average at £3,052 each, although this is arguably because they may have had less time to build up substantial debts.
Those aged 35-44 had the highest proportion of heavily indebted individuals, with 8% of the age group owing over £20,000.
Men are more indebted than women, at an average of £5,969 to £5,107 – and it is important to recognize that these figures are based only on those individuals with any debt at all.
When Brits with zero debt are incorporated into the sums, the average amount owed per person in the UK as a whole drops to £3,232.
“Personal debt levels have ballooned in the UK over the past decade,” said Mr Frampton. “For many, being in debt has become the norm; there’s much less of a stigma attached.
“Where the debt is manageable, this isn’t a problem. But it can be all too easy to get caught in a debt trap, where one debt starts to create others.”