Family debt up by 42% in six months
Family debt has jumped to a two and a half year high, having rocketed 42% in the last six months alone, according to Aviva’s latest Family Finances report.
The average family now owes £13,520 on top of any mortgage borrowing, the highest it’s been since summer 2013.
Married with debt
Couples with two or more children have the most debt of any family type, totalling an average of £18,830. This is more than three times the average £5,070 owed by single parents, who borrow the least across all family types.
Average credit card debt rose by 21% from £1,960 in summer 2015 to £2,370, while the amount owed on overdrafts increased by 37% from £870 to £1,190.
One in four families now owes money on a personal loan, up from 23% a year ago with an average outstanding balance of £2,080.
Over the last five years, mortgage debt is also 21% higher than the £51,850 owed in 2010.
Louise Colley, managing director, protection, at Aviva said: “The alarming levels of rising household debt, paints an uncertain picture for the family purse in 2016.
“With the possibility that the Bank of England could raise interest rates this year, families who have grown accustomed to cheaper credit – particularly those who have spent heavily over the Christmas period – need to ensure they are still fully prepared to manage debt repayments, as well as other monthly outgoings, should rates go up.”