Loan News Unbiased Paying Off Debt Interest Eats Up January Pay

Written by Editorial Team

05 February 2007

A British consumer who worked every single day in January would still only manage to clear the interest on their personal debt, leaving the debt itself untouched, Unbiased.co.uk estimates.

The study finds that the entire January pay cheque for an average annual income of £23,556 would be swallowed up by the £2,012 interest on the average Briton’s credit card and loan debt.

The figures suggest the need for a renewed push to combat debt in the UK, Unbiased.co.uk’s chief executive David Elms commented.

“The real headline will come when official figures show people controlling their spending behaviour and increasing their saving power,” he noted, stressing that most savers would prefer to direct their hard-earned salaries towards a “nest egg” than see it all consumed by servicing their debt interest.

To encourage customers to relieve their debt difficulties, the financial advice website named February 1st Debt Freedom Day.

“Although Debt Freedom Day is of course a hypothetical point in the financial calendar, it… should be seen as a wake up call to those who carry personal debt”, Mr Elms urged.

Personal debt in the UK is rising by £1 million every 3.85 minutes, Credit Action statistics show.