Brits are making a serious effort to cut their spending down. According to the latest figures from debt charity Credit Action, December saw Brits lower their personal debts to an average of £7,948 per month.
New data from Credit Action reveals December’s average household debt in the UK (excluding mortgages) was £7,948 – down from November 2011. Including mortgages, however, it rose to £55,823, which is up from a revised £55,818 in November.
Further figures from December 2011 found that outstanding personal debt stood at £1.451 trillion. In comparison to data from December 2010, the figure from last year is down from £1.454 trillion. In addition, the amount of personal interest paid by Brits also fell, decreasing from £173 million to £171 million in December 2011.
The average amount owed per UK adult (including mortgages) stood at £29,547 last December, and was around 122% of average earnings.
In addition to that, Credit Action figures revealed that during the 2011 Q3 (July, August and September) up to 331 people were declared insolvent or bankrupt every day in the UK and 101 properties were repossessed every day.
‘A cause for concern’
UK consumers are making concentrated efforts to cut down, but Credit Action CEO Michelle Highman points out that this is not a cause for celebration, but “a cause for concern”.
In her opinion, these figures represent an increased level of caution and concern in average households, which impacted confidence in putting Christmas on credit last year.
“Whilst it is heartening that people did not overspend, the underlying reasons for not doing so may prove to be a real cause for concern in the coming year,” added Highman.
With increased expenditures and lower incomes, many consumers are turning to alternative methods of funding to help them cope with the cost of even basic amenities. Payday advances could help to pay for rising living costs.