Over 650,000 people sought debt advice in 2018

In 2018, 657,930 people contacted StepChange Debt Charity seeking advice, up from 619,946 in 2017, the charity revealed.

In its 2018 Statistics Yearbook, published today, the StepChange found that the profile of people seeking help and the type of debts they have continues to change over time, despite a “particularly notable” increase in single parents, with 85 per cent of them being women.

Last year, 23 per cent of those who took debt advice were single parents, up from 21.5 per cent in 2017, while the figure has been steadily increasing year-on-year from 18 per cent in 2014. However, the charity highlighted that single parents are increasingly over-represented amongst those with existing debt issues, especially when single parents account for just 6 per cent of the UK population.

With regards to the causes of debt, StepChange identified that the top three were unemployment or redundancy (17 per cent), injury or illness (16 per cent) or other reduced income (17 per cent). Just one in nine of those in debt attributed their debt problems to a lack of budgeting, down from one in five just two years earlier.

On consumer borrowing, the report found the most common form of debt among clients was credit card debt, with 68 per cent of those seeking help having this type of debt when contacting the charity, followed by overdrafts and personal loans.

Following the trend seen in recent years, last year the average age of new StepChange contacts continued to fall. The average age of a new client in 2018 was 40, down from 41 in 2017, and two thirds of clients were under 40, compared to just 52 per cent in 2014. The majority of clients were in work, and 82 per cent rented their home.

Commenting on the findings, StepChange Debt Charity CEO Phil Andrew said: “The number of people who contacted us last year works out at one every 48 seconds – a record level of demand. That’s the scale of the debt problem in the UK, and our advisors hear every day the devastating impact that debt can have on people. While a huge amount has been done to support people in problem debt and reform credit markets, our client insight shows that there’s still much more for government, policy makers and creditors to consider.

“In line with the strategy we launched last summer, we’re working flat out to be able to double the number of people we can help over the next few years. While debt can strike at any age, on average our clients are getting younger. It’s important that policymakers work to help turn the tide and prevent debt becoming an inevitable rite of passage for young adults.”

Royal London personal finance analyst Becky O’Connor added: “The demographics of this one debt charity’s clients tell us a story of intergenerational inequality, with debt affecting younger people under 40 the most. The report also shows that employment is not the answer to money troubles and that renters, who often bear higher housing costs, are more likely to encounter financial difficulty.

“Having two incomes to support a family is hard enough, but single parents face even more pressure and insecurity, as this report clearly shows.”

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