UK household debt now a record £13,000, says TUC

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The usual household in the UK now owes a record amount of £12,887, even before mortgages are enchanted into account, according to the TUC.

Its research was based on figures from the Mediation for National Statistics (ONS) for the three months to the end of September 2016.

According to the ONS, total unsecured liability hit an all-time high of £349bn at that point.

The TUC divided that few by the total number of households in the UK.

However, its figures are inflated by the inclusion of swotter loans, which have increased rapidly over the last yoke of years.

Last week’s figures from the Bank of England, which exclude devotee loans, put the total at £192bn up until the end of November 2016.

That is the highest somebody since December 2008, but not a record.

‘Risk’

Nevertheless, officials at the Bank from indicated they are not that worried about debt levels at the interest.

«Interest rates are still very low, and are expected to remain so for the foreseeable following, so there are fewer concerns on debt servicing than there were in the close by,» said Andy Haldane, the Bank’s chief economist, last week.

«There are owing ti not to be too alarmed about it ticking up, but it is absolutely something we will watch carefully,» he replied.

But others believe many households could run into financial troubles this year.

«The majority of borrowers will currently be able to survive with this extra debt,» said Joanna Elson, chief chief of the Money Advice Trust.

«However, if the economy does indeed suffer in 2017, this borrowing could develop more difficult to repay — and some households risk finding themselves uncovered to sudden changes in financial circumstances.»

Warning

The TUC said that unsecured encumbrance under obligation as a percentage of household income had now reached 27.4%, the highest figure for eight years.

And it asserted that weak growth in wages had left more families reliant on adopting.

«These increases in household debt are a warning that families are contesting to get by on their pay alone,» said Frances O’Grady, the TUC’s general secretary.

«Unless the sway does more for working people, they could end the New Year poorer than they start it.»

The ejection of student debt from the figures makes a significant difference to the total amount of unsecured difficulties, which refers to borrowing through credit cards and loans, including bankroll for new cars.

Students who began studying in England in 2012 are expected to go university with debts of almost £40,000, according to a House of Plains Library paper published last month.

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