In today’s ever-changing financial landscape, it is crucial to stay informed about the state of money and debt in the UK. By analysing key figures such as credit card debt, inflation rates, and average household debt, this article aims to shed light on the current state of personal finances in the UK and offer valuable insights into financial trends. Whether you are a student, employed, self-employed, unemployed, a homeowner, or a renter, understanding these statistics can help you make informed decisions about your own financial situation.
UK Money Statistics 2023
UK Personal Debt
People in the UK owed £1,846.5 billion at the end of October 2023. This represented an increase of £22.5 billion from the previous year, with each UK adult accumulating an additional £423 of debt. The average total debt per household, including mortgages, stood at £65,756, while the average debt per adult was £34,716. This amount of debt accounted for approximately 100.7% of average earnings. However, it is important to note that this figure had actually decreased from the previous month’s revised value of £34,698.
Total Personal Debt
The total personal debt in the UK reached £1,846.5 billion in October 2023, reflecting an increase of £22.5 billion from the previous year. This trend of increasing debt is expected to continue, with household debt forecasted to rise to £2,429 billion by 2025, according to the Office for Budget Responsibility’s November 2023 forecast. This forecast implies that the average total household debt would reach £85,274 assuming household numbers align with the Office for National Statistics‘ population projections.
Average Total Debt per Household
The average total debt per household in the UK was £65,756 in September 2023. This amount saw a decrease from the previous month’s value. The decreasing trend in average household debt suggests that individuals are taking steps to manage their debt levels and reduce their financial burden.
Average Total Debt per UK Adult
On an individual level, the average total debt per UK adult in October 2023 was £34,716. This amount represented approximately 100.7% of average earnings. While it is encouraging to see a decrease in average household debt, it is important to continue promoting financial literacy and responsible borrowing practices.
UK’s Total Interest Payments on Personal Debt
Based on October 2023 numbers, the UK’s total interest payments on personal debt over a 12-month period would have been £70,173 million, with an average of £192 million paid per day. The average annual interest per household would have amounted to £2,499, while per person it would have been £1,319. These figures indicate that interest payments consume a significant portion of individuals’ disposable income, equating to approximately 3.83% of average earnings.
Household Debt Forecast
The forecast for household debt in the UK, including all types of debt, predicts an increase from £2,259 billion in 2023 to £2,429 billion in 2025. This forecast suggests that the average total household debt would amount to £85,274. This projection emphasizes the need for individuals to manage their debt effectively and adopt responsible borrowing practices to avoid financial strain.
Outstanding Consumer Credit Lending
In October 2023, outstanding consumer credit lending in the UK amounted to £219.4 billion. This represented an increase of £962 million from the previous month’s total. Within this total, outstanding credit card debt accounted for £67.9 billion, reflecting an 8.5% increase in the year leading up to October 2023. On average, credit card debt per household was £2,417, while per adult it stood at £1,276.
Outstanding Credit Card Debt
At the end of October 2023, the total outstanding credit card debt in the UK was £67.9 billion. This figure indicates a significant financial burden for individuals with credit card debt. Furthermore, the average credit card debt per household was £2,417, and per adult, it was £1,276. When considering the average interest rate, it would take approximately 26 years and 6 months to fully repay this debt if only minimum monthly payments were made.
Credit Card Repayment Time
To fully repay the average credit card debt of £2,417, assuming the minimum monthly repayments are made, it would take 26 years and 6 months. However, if an individual consistently pays £68 each month towards their credit card debt, the debt could be cleared within 5 years.
Net Lending to Individuals and Housing Associations
In October 2023, net lending to individuals and housing associations by UK banks and building societies increased by £969 million compared to September 2023 figures. This increase equates to a daily average of £31.3 million. Net mortgage lending increased by £7 million, while net consumer credit lending increased by £315 million during this period.
Everyday in the UK
The daily dynamics of the UK population and economic activities provide insights into the country’s financial landscape. The population of the UK decreased by an estimated 151 people per day between 2020 and 2021. On average, a UK household spent £4.17 per day on water, electricity, and gas.
In terms of insolvencies, 279 people per day were declared insolvent or bankrupt in England or Wales between August and October 2023. This equated to one person every 5 minutes and 9 seconds. In Northern Ireland, there were 4.0 insolvencies reported per day in October 2023, while in Scotland, there were 22.3 insolvencies recorded per day in the three months leading up to June 2023.
Citizens Advice Bureaux in England and Wales dealt with 1,083 debt issues every day throughout the year until November 2023. This indicates the prevalence of debt-related challenges faced by individuals in the UK. Additionally, an average of 6.8 properties were repossessed every day in the UK between July and September 2023.
The number of UK mortgages with arrears exceeding 2.5% of the remaining balance increased by 37.0 per day in the year leading up to September 2023. Furthermore, the number of unemployed individuals in the UK increased by 658 per day over the same period.
The daily statistics also revealed that 1,109 people reported becoming redundant per day between May and July 2023. Moreover, the government debt increased by £442 million per day in the three months leading up to October 2023.
Interest payments constituted a significant financial burden, with borrowers paying £192 million in interest per day in October 2023. Additionally, it costs an average of £24.44 per day for a couple to raise a child from birth to the age of 18, while for a lone parent family, the daily cost amounts to £29.50.
In summary, the UK money statistics provide a comprehensive overview of personal debt, total debt, interest payments, and various aspects of everyday life. Analysing these figures allows for a deeper understanding of the financial challenges faced by individuals and the collective impact on the UK’s economy. It highlights the importance of financial literacy, responsible borrowing, and effective debt management to promote financial well-being for individuals and households.