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Consumers under 21 owe more than £8,000 in unsecured debts, according to new
research.
The figures, published by debt solution specialists ClearDebt, reveal that the
average 18-21 year old owes £8,195 in unsecured debts against a typical take
home salary of £8,987, making the average debt level of this age group 91%.
A statement from ClearDebt said this pattern demonstrated that young people were
spending their way into debt by trying to maintain a lifestyle beyond their
means.
ClearDebt has subsequently added its support to calls for children to be taught
about personal finance in schools.
The figures were released just after a petition, which called for personal
finance education to be restored to the schools curriculum, was closed. The
petition, which was organized by MoneySavingExpert and Mumsnet, was signed by
30,678 people.
Jacqueline Cohen, marketing manager of ClearDebt, explained: "The data backs up
the essential need to prepare children for financial independence".
"As they enter adulthood, they’re put into a situation where they will sink or
swim. Without the necessary education and understanding about how to manage
finances, they will undoubtedly sink."
Cohen also said that there had never been a more important time to teach
children how to manage their money effectively.
She added: "The fact that at just 18 they have already worked up debt is
heartbreaking. Surely we can do better for them than that?"
The research also showed that 37% of those with debt problems in the UK are
under the age of 30. Between the ages of 25 to 30, average personal debt
increased 56% from £12, 997 to £20,271.
In the same age period, average take home pay only rose by 19% from £11,725 to
£13,967.
The highest ratio of debt to income peaked for those aged 66, where an average
of £3.14 was owed in credit card balances and unsecured loans for every £1
earned, while the UK’s highest average debt was attributed to those aged 64, who
typically owe £43,581.
Source:
Getting Paid
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