70 days salary ‘tackles interest payments alone’

The combined earnings of both January and February are not enough to pay off the interest on UK credit cards and loans, let alone start tackling the actual debt itself, new figures have shown.

Unbiased.co.uk, an independent financial adviser search, has named Monday March 10th as Debt Freedom Day – the day on which Brits have worked enough to pay off the interest on their credit cards and personal loans.

However, last year’s Debt Freedom Day was as early as February 1st, the firm explains, showing a significant increase in borrowings and a “real warning” for consumers.

Overall, personal debt has risen by over ten per cent during the last 12 months, with a six per cent increase in interest payments.

Brits currently owe £9.8 billion in personal loans, compared to £2.6 billion last year, with interest payments on these now reaching £1.5 billion.

David Elms, chief executive of the firm, commented: “While Debt Freedom Day is of course a hypothetical point in the financial calendar, people should pay attention to it.”

“Seeking independent financial advice can be the first step to taking control of your finances,” he advised, explaining it is more important than ever to manage debt responsibly in today’s financial climate.

Credit Action reports that around 6,600 debt problems are dealt with daily by Citizens Advice Bureaus.

© Adfero Ltd

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