Our latest research: You’re not alone in debt

posted by in Budgeting

StepChange Stats yearbook 2016As well as providing debt advice, we regularly produce research into personal debt trends in the UK.

The Statistics Yearbook, released twice a year, is one of the most important pieces of research our policy team produce, and the 2016 edition is released today.

Why is it important?

The report’s important for a number of reasons; not only does it help us identify which groups are in debt and why they need help, but we believe it can also help people feel less ashamed about it.

Why? Because if you’re in problem debt you may be feeling isolated and embarrassed, thinking that you’re the only one experiencing it. The report highlights that you’re not alone. More people than ever contacted us for debt advice in 2016 – around 0.9% of the UK population.

What are the key findings?

1. You’re not alone if you’re in debt

In 2016 just under 600,000 people got in touch with us for help in dealing with their debt: that’s one person every 53 seconds.

Our website has also been busier than ever. We had 3.3 million visits last year, and the number of visits has doubled since 2011.

2. Debts are getting larger

We’re seeing an increase in the amount of debt our clients have. For the first time for at least eight years the average unsecured debt of our clients has gone up, with those earning less than £30,000 driving the increase.

Four out of every ten people we helped in 2016 were also behind on their essential household bills, such as gas and electricity: on average they owed over £2,000 on these priority bills in addition to their credit cards, payday loans, overdrafts and catalogues.

3. Our clients are getting younger

Another trend identified in the report is that the age of the people contacting us for debt advice is falling. Last year 60% of clients were under 40. Five years ago only 52% of clients were in this age group.

4. If you rent, you may be more at risk of getting into debt

There has been significant growth in demand for debt advice from clients living in rented accommodation. The proportion of clients renting their home has increased from 61% to 77.3% and almost one in every four of our clients lives in private rented accommodation.

5. Your income probably isn’t growing

Family wages aren’t increasing. Compared to figures from five years ago, people contacting us now have £46 less each month in their total household wage.

Unfortunately this means that the number of clients unable to break even, after their debt payments have been accounted for, has continued to increase. Even after we’ve helped clients agreed a realistic budget and cut back their spending, 29% of them didn’t have enough income to cover their essential household bills.

You can read the full report on our website but the overall message is clear: personal debt in the UK is growing. If you’re in debt, you’re not alone.

Rebecca Drury is the latest addition to the MoneyAware team joining in November 2016, with a background in ecommerce and social media management. She enjoys live music, travel (especially trying local delicacies) and loves reading vintage sci-fi novels. She's an excellent dancer and loves researching money-saving tips.

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