Nine million 'in severe debt'

Nearly nine million people are estimated to be trapped in a spiral of severe debt in the UK, the Government-backed body the Money Advice Service (MAS) has found. Just one in six getting help to break free.

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'Millions could escape spiral of debt' with free advice

Millions of people could escape their spiral of debt by accessing free advice.

However, this study presents us with a fundamental challenge: the majority of people with debt difficulties do not seek advice.

This is the first time we've had such a detailed understanding of the complexity of their lives. So now, armed with greater insights, we will work with advice agencies, creditors and public bodies to help as many people as possible access free, high-quality, debt advice.

– Caroline Rookes, CEO of the Money Advice Service

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More than half of those in debt are working

The report used information from credit checking company Experian to build a profile of those who have sunk badly into debt.

Families dependent on benefits made up around one fifth (20.2%) of those who are over-indebted, while "worried" working families who find being in debt a constant burden accounted for a similar proportion (19.4%).

More than half of those in debt working Credit: Barry Cronin/PA Wire

Nearly one in 10 (9.8%) of those with bad debts were identified as people who are working for the first time and one in eight (11.3%) are struggling students. Some 1.1% of this group are people eking out an uncomfortable retirement.

Almost three-fifths (58%) of those with severe debts were found to be in employment and nearly half (48%) live in a privately-owned home.

UK's five most over-indebted areas identified

The MAS report, titled Indebted Lives, identified the UK's five most over-indebted areas as: Hull, Nottingham, Manchester, Knowsley and Liverpool. Around two-fifths of adults in all these areas are struggling with debt.

Liverpool was identified as one of the UK's five most over-indebted areas. Credit: Martin Rickett/PA Wire

At the other end of the scale, Richmond upon Thames in south London has just 1.2% of its population struggling with debt, according to the report.

Two thirds of those in debt are women

  • Around one fifth (21%) of those the research classed as over-indebted, equating to 1.8 million people across the UK
  • A further 11% were not concerned about being in debt
  • One in eight (12%) over-indebted people said they were thinking about trying to get help soon
  • Three-quarters (75%) of the estimated 8.8 million people with severe debt problems are under 45 years old and nearly two-thirds (64%) are women
  • Some 74% of those with severe debt problems said they are unhappy
  • Around four million people are thought to have been struggling to pay their bills for more than a year
  • Just under half (48%) of those with severe debt had to forego basic necessities

Nearly nine million people in 'severe debt'

Nearly nine million people are estimated to be trapped in a spiral of severe debt in the UK, the Government-backed body the Money Advice Service (MAS) has found.

Just one in six getting help to break free.

Nearly nine million people in 'severe debt' Credit: Owen Humphreys/PA Wire

Around 8.8 million people are "over-indebted", meaning they have fallen at least three months behind with their bills in the last six months or they feel their debts are a heavy burden

But just 17% of this group said they are getting advice to help them deal with their debt, while around two-fifths (40%) said they did not feel able to talk to their creditors and 44% did not know where to turn for help, the research from more than 5,000 people found.

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